19960626_2.docx

MINUTES OF DECISION MEETING
June 26, 1996 - 1:30 p.m.
In attendance at this decision meeting were Commissioners Ralph Nelson, Marsha H. Smith and Dennis Hansen and staff members Don Howell, Scott Woodbury, Weldon Stutzman, Rick Sterling, Ron Law, Tonya Clark, Syd Lansing, Madonna Faunce, Marge Maxwell, Stephanie Miller, Randy Lobb, Dave Schunke, Birdelle Brown, Bev Barker, Eileen Benner, Bill Eastlake, Wayne Hart and Myrna Walters. Also in attendance were Ron Lightfoot of U S West; Jeanette Bowman of Idaho Power Company; Skip Worthan and Mike McGrath of Intermountain Gas Company and Fred Logan and Bonnie Saunders of GTE.
Commission President Ralph Nelson called the meeting to order at 1:30 p.m.
Items considered at this decision are those listed on the attached Decision Meeting Agenda.
1. Regulated Carrier Division Agenda dated June 26, 1996.
Commissioner Hansen made a motion to approved the items on the Regulated Carrier Division Agenda; Commissioner Smith seconded that motion; Commissioner Nelson concurred.
2. WWP-E-95-2 Washington Water Power Company’s 1995 Electric Integrated Resource Plan (IRP) (Decision Memorandum from Scott Woodbury).
Scott Woodbury went over the various cases and timing.   In WWP-E-93-10, the Commission in concluding that case, deferred the matter of the company’s first deficit year to their IRP filing and that filing is the WWP-E-95-2 filing. The WWP-E-96-3 case is the annual variable rate filing by WWP which affects existing contracts and new or projected contracts using gas. It is for small Qfs which require posting of rates. In the 96-2 filing, has included in its calculations, the change in first deficit year from the year 2000 which was in effect up until today, to 2010 or 2011.  It is that change in deficit year which the commission has indicated is appropriate to take up in 95-2. It was noticed up and scheduled for comment. Staff was the only party to file comments. Earth Power missed their opportunity in that case. so they filed their Motion in WWP-E-96-3 saying that WWP was assuming that the rate had been changed. They are also saying that the Commission in moving to the new avoided cost rate methodology didn’t intend to change the methodology in which the first deficit year was calculated. This is the position of Earth Power.
They are saying the Commission was quite specific as to what should be included or excluded and they say it is improper to use the first deficit calculation as included by WWP in their integrated resource plan. You could look back at prior order to see what was intended.  
Scott said he has a position. He spoke to Blair Strong of WWP and their preference is that the Commission approve their IRP filing but if the Commission feels the issues raised are of such significance that there should be at least an oral argument then perhaps that could be scheduled next week. Next decision meeting is July 1 and WWP is asking for an effective date of 7-1-96 of the variable rate case. WWP will have people here on the 2nd for the direct access tariff case and Blair could be here also.  
Commissioner Nelson commented - on the first deficit year, this wasn’t really before the commission.
Scott said the commission required in the WWP-E-93-10 case that the company make a filing. Commission then deferred that to the IRP case. They filed their calculations in 93-10 and they are now in the IRP filing. commission did issue an order saying it will remain at year 2000 until changed.
Commissioner Smith asked (1) if the Commission gave any indication when we set that calculation as to whether we expected to continuing past practices or methodology or did we say the field was wide open for change? And (2) if we approve the IRP does it impair any party from litigating the first deficit year in the new case?
When we moved the process into the IRP process, did we give any indication whether we intended to use the same practices as used in the past or did we say it is a whole new ball game and people can propose whatever? Or were we silent?
Scott said he didn’t think the issue was directly addressed for separate calculations for the first deficit year for avoided cost and IRP. It was his understanding in moving away from the old methodology to IRP that we were supposedly leveling the playing field and that there would be no separated required calculation for small Qfs or others. There would be a deficit year used for both. Think the Commission acknowledged that it would be changed at least every two years. History of the trigger is that it would be more frequent timing on the trigger.
Commissioner Nelson said he wasn’t aware we had abandoned the trigger.
Scott said - didn’t think we foreclosed company from it, but as to whether the trigger we had in prior methodology and all of the exclusions and inclusions carried forward. Peter Richardson said it was confusing and they weren’t aware it was being changed.  
There is the issue on the table of procedure for accepting this now that it is used for calculation of avoided cost. To the extent that it is the company’s IRP. Commission could acknowledge the filing. Because there is a change in the first deficit year for avoided cost purposes maybe as to that particular aspect a limited order should issue. As to how it affects the 96-3 filing, if the commission approves that, it will be approving a set of rates that incorporate change in IRP first deficit year from 2000 to 2010. If the commission defers decision on that, 2000 would remain and company would have to calculate on that until matter is decided.
As to question of Peter Richardson’s filing and if it should have been in 93-10, think all of the companies have filed their integrated resource plans showing a first deficit year. No one has attempted to duplicate the prior methodology for avoided cost purposes.
Commissioner Hansen asked what is so critical about the first deficit year?
Commissioner Smith explained that it changes the rate you pay a cogenerator.
Commissioner Hansen asked - the rate paid today would change based on when you next project you needed power?
Commissioner Nelson explained the process and Scott further clarified.
Commissioner Hansen said - but if a company projected 2000 and then decided 2011, are they locked in? Which number is correct?
Commissioner Nelson said we don’t know, that is his problem. You sign a contract that is firm for 20 years. As far as the parties are concerned you can’t go back and change prices so it is important to have a Commission decision up-front.
Commissioner Smith commented - both could be right. The 2000 was set in the past. It looked like at year 2000 they would need resources. In 1995 when they filed their IRP and they showed their surpluses, they changed to 2010. So she thought they looked at it every two years and were continuing to look at it. Don’t think it is a matter of one being wrong and one being right. If net year they look at it they could come up with a different date.
Rick Sterling said - assuming that the commission accepts the fuel adjustments, the difference between using 2000 and 2010 on a 20-year levelized contract, is 3 mills.
Commissioner Nelson commented he didn’t think the 2011 was ever presented to the commission.  
Scott Woodbury said in the initial filing in May 1995, the Commission stated (quoted from the order)when they submitted updated data, one of the proposed modifications was to change deficit year. Said it would be more effectively solved in the IRP filing. IRP came in with no testimony attached. Change was accomplished in the 93-10 case by testimony of Young showing that calculation.
Commissioner Nelson asked - do we have the option of accepting the IRP and holding the first deficit year until an upcoming case?
Scott said he didn’t think there was another case on the horizon.
Commissioner Smith said it was her preference to approve the IRP and since the first year must be an issue in E-96-3, they can bring it up there. Suspend the July 1 effective date.
Brad Purdy explained that the new filing had the deficit year changed in it already.  
Commissioner Nelson suggested suspending the effective date of the tariff and take a look at the first deficit year.
Brad suggested - you could change the two variables but with respect to WWP, keep year at current; upgrade the two variables for all three companies and then deal with the first deficit year.
Commissioner Smith asked Peter Richardson why he didn’t litigate this in another case?
Peter Richardson replied that the IRP was for over one mw and thought under 1 mw would be set by SAR, different from IRP. Didn’t care how IRP comes out.
Brad Purdy spoke to the small versus large projects.
Commissioner Smith suggested oral argument to clarify what the Commission meant or put the issue in another case; suspend the portion referring to first deficit year but approve others.
Commissioner Nelson suggested going to Item 4 on the Agenda - WWP-IPC-UPL Whether to approve calculation of avoided cost based on updated fuel prices.
Scott Woodbury commented he thought that the utilities have been consistent in using first deficit years in their IRPs and their schedules; so if there is an error in WWP’s, the other two companies have done the same thing.
Commissioner Smith suggested procedurally approving the IRP by order and allow Mr. Richardson to petition for reconsideration. Then the commission could have a hearing.
Mr. Richardson quoted the 93-10 order (published SAR rate). IRP is only for excess of one mw.
Scott Woodbury said he thought in reference to SAR, its a published rate based on natural gas but still using the IRP.
Rick Sterling commented that the only reference to adjustments in the model and in the variable that go into the calculation which is the mechanism of the model. No one is in dispute of that. Can approve Item 2 on the agenda.
Commissioner Nelson said he would suggest suspending Item 4 and resolve the deficit year.
Commissioner Smith said she thought the question is much bigger than that. The question is what did the commission intend as to the procedure for rates for projects greater than 1 and less than 1? Did we intend to have two processes or is our process for those less than one? Is looking for some advice to get an answer to what we said in the previous order.
Randy Lobb said he was not sure if Idaho Power’s IRP has been approved. IPC’s deficit year has also changed. All the parties should be parties to that to make certain that they can change their first year automatically or not. In WWP’s case it would be 3 mills. Explained the fuel has an opposite effect. There is no problem with adjustment to fuel prices. That is a good reason to not suspend.
Scott Woodbury said he thought this was really a petition for clarification as to the commission’s January ‘95 order on avoided cost.
Decision was to hold Items 2 and 4 until Monday (next decision meeting) and suggest a procedure to settle this.
5. Case No. IPC-E-96-2 Idaho Power’s Year-Round Irrigation Proposal.  
Commissioner Hansen said he would like to see our staff get back and investigate a couple of other proposals in this area. Could we hold this until Monday?
Commissioner Smith said she wanted us to schedule a meeting. One of the disadvantages of having staff to this, they don’t always get all the ideas of the Commissioners. Would like to talk to the company about some ideas she has regarding incentives if their goal is to keep irrigators on all year. Said she apologized to the company because this is not what she liked. Would like to set up a meeting to get response to her questions.
Commissioner Hansen also thought it would be beneficial.
Hold this item until after meeting with company to answer questions.
6. Scott Woodbury’s June 18, 1996 Decision Memorandum re: Case Nol. WWP-G-96-2 Natural Gas Transportation Agreement (IMSAMET).
Commissioner Smith made a motion to consider this by modified procedure.
Commissioner Hansen seconded the motion. Commissioner Nelson agreed.
7. Scott Woodbury’s June 18, 1996 Decision Memorandum re: Case No. WWP-E-96-4 Washington Water Power Company PCA (Rebate).
Commissioners approved using modified procedure.
8. Scott Woodbury’s June 18, 1996 Decision Memorandum re: Case No. INT-G-96-4 Intermountain Gas Company Demand Side Management Programs.
Commissioner Hansen asked why the recommendation of staff to put this out on modified procedure.
Commissioner Nelson said he thought there might be some comments on conservation to be made.
Scott Woodbury said staff has production request to send to company. There are two new programs but one is a change in their refund amount for water heaters and staff has questions about whether to even continue it.
**Will go out on modified procedure.
9. Scott Woodbury’s June 19, 1996 Decision Memorandum re: Case No. WWP-E-96-5 Request for Exemption from Master-metering Rules Brookside Landing Retirement & Health Care Facility.
Scott Woodbury spoke to the Phase II of Crossings, handled this way. Commission granted that exemption. WWP was provided documentation form that case. Reviewed the process and sent a letter indicating they have no problem with an exemption.
Commissioner Nelson asked about the conservation measures?
**Approved with appropriate conditions put in the order.
10. Case No .IPC-E-96-12 (Idaho Power Company) Black Canyon No. 3 hydro project. First Amendment.  
Commissioners approved amendment, to be handled by Minute Entry.
11. INT-G-96-3 Intermountain Gas Company Annual PGA Tracker--0.635% decrease.
Commissioner Nelson said in review - staff has checked the numbers and recommends approval.
Did have a comment on the last “bullet” point. Last question - would like to say that a couple of years ago the California Commission got excited about comparing fixed contracts with spot market and criticized the company for getting into the spot markets, I don’t share that feeling.
Commissioner Smith commented - but still talk to them about it.
12. Weldon Stutzman’s June 13, 1996 Decision Memorandum re: Case No. GNR-T-95-4, Order No. 26194; Amendment to Order Establishing Funding Levels for Telecommunications Relay Services.
Commissioner Smith commented on the way the amendment was set out - wanted the amendments noted.
13. Weldon Stutzman’s June 19, 1996 Decision Memorandum re: Requests by Small Independent Telephone Companies for Designation as Eligible Telecommunications Carriers Under Federal Telecommunications Act.
Commissioner Smith asked if a Deputy AG coyuld send them a letter saying this is not necessary at this time, and if you ever get in trouble with this hypothetical situation, the Commission will support you.
Agreed.
14. Weldon Stutzman’s June 20, 1996 Decision Memorandum re: Case No. ATT-T-96-1. Comments Regarding AT&T’s Application to Amend its Certificate to Provide Local Exchange Services.
Commissioner Hansen said he didn’t have a problem with approving the application if they provide a map, etc., but do think we need more information.
Commissioner Smith said what she would like to see is a reply from the Applicant. Would like AT&T to respond to the comments that were filed. Think that would help her. Would like to have the company respond. Weldon Stutzman said he knows that the company is working on getting the Commission some more information.
**Decision was to give them a couple of weeks to respond to the filed comments.
14A. Weldon Stutzman’s June 24, 1996 Decision Memorandum re: Case No. USW-N-96-1 U S West Communications’ Tariff Advice No. 96-01.
Decision was to do it modified procedure.
15. Beverly Barker’s June 21, 1996 Decision Memorandum re: Service Quality Rulemaking.
Commissioner Nelson commented - wondered if we do this if we weren’t duplicating what we have done on telecommunications already.
Commissioner Hansen said he thought we had come up with some standards on revenue sharing.
Bev Barker commented that she was not sure staff would agree with what was settled.
Commissioner Nelson suggested directing staff to initiate informal workshop regarding service quality standards.
Commissioner Smith agreed.
Commissioner Hansen said it seemed that before when staff was involved with U S West on service quality standards there was a concern of what the feels. Is staff comfortable without guidance from the Commission how to proceed in this? Thought staff was out there in the trenches and didn’t know what the Commissioners want. Do you feel comfortable knowing where Commissioners stand on these standards?
Bev Barker replied she did not.
Commissioner Nelson said he thought electric would be quite a bit different than telephone.
Bev Barker said she thought there was more agreement to need to establish in electric.
Eileen Benner said in telecommunications this does give some recognition, just by giving staff authority to conduct workshops. There is also the past revenue sharing evaluation case that discussed service quality. Staff could look at those guidelines.
Commissioner Smith said circumstances are much different today than in the past. Competitive market may mean poor service and going out of business.
Bev Barker said what might be helpful is Commissioner/Commissioners participating in workshops.
**Will start with workshops.
16. Marge Maxwell’s June 24, 1996 Decision Memorandum re: Washington Water Power’s Tariff IPUC No. 26 Natural Gas Service, Schedule 170.
Approved.
17. Marge Maxwell’s June 24, 1996 Decision Memorandum re: Washington Water Power’s Tariff PUC No. 25, Electric Service, Schedule 70.
Approved.
18. Marge Maxwell’s June 24, 1996 Decision Memorandum re: Idaho Power Tariff Advice No. 96-02 Revisions to Schedule 66 and Rule F.
Marge clarified that the filing was made May 15 and no public notice has been given.
Commissioner Smith clarified - Staff is recommending waiver of one time in 12 month period...  Her thought is that whether or not they make it a habit, it still costs and giving one free happening might encourage them.
Commissioner Nelson said he would allow them to institute $15 charge to be collected....but not tro implement the charge when they actually disconnect. On that basis, wouldn’t push to grant a one time waiver of the fee.
**Will be approved with that change, effective August 1 to give company time to give proper notice to customers.
20. Birdelle Brown’s June 24, 1996 Decision Memorandum re: GTE Advice 96-10 to Remove Resale Prohibition on Intralata Toll and Provide a Wholesale Discount for MTS.
Decision was: Go modified procedure; suspend tariff.
21. Birdelle Brown’s June 24, 1996 Decision Memorandum re: Continuation-GVNW Letter dated April 1, to Reduce Access Rates for Universal Service Fund Recipients to Statewide Average Rates.
There were four questions asked by staff - answers approved by commissioners were: (1) yes; (2) yes; (3), yes and (4) One month.
22. Staff Response to the FCC NPRM on Paytelephones Docket #CC96-1289.
Commissioner Smith had some editorial changes to be made - then it can go out.
23. Terri Carlock’s June 24, 1996 Decision Memorandum re: Idaho Power company’s Request to Extend the authority to Issue and Sell Stock Pursuant to the Shareholders Rights Agreement.
Approved.
Meeting was adjourned.
Dated at Boise, Idaho, this 10th day of July, 1996.
Myrna J. Walters
Commission Secretary
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