20061109notice_of_application_order_no_30176.pdf

Office of the Secretary
Service Date
November 9, 2006
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF PACIFICORP DBA
ROCKY MOUNTAIN POWER'CASE NO. PAC-06-
APPLICATION FOR A DEFERRED
ACCOUNTING ORDER TO DEFER THE NOTICE OF APPLICATION
COSTS RELATED TO THE MID AMERICAN
ENERGY HOLDINGS COMPANY NOTICE OF
TRANSITION MODIFIED PROCEDURE
ORDER NO. 30176
On October 10, 2006, PacifiCorp dba Rocky Mountain Power filed an Application
seeking an order authorizing the Company to defer and amortize over a three-year period the
costs related to the MidAmerican Energy Holdings Company transition (the "MEHC
Transition ). The Commission has jurisdiction over the Company s request pursuant to Idaho
Code ~ 61-524. The Application did not include any request or recommendation for how the
Company would like it to be processed.
NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED that, according to the Application, the Company is
incurring costs related to the MEHC Transition for employee severance and conversion of
software to an accounting calendar year. The Company seeks an order authorizing the
capitalization of these costs through March 2007 and then amortization of the capitalized balance
over a three-year period to begin at the implementation of new rates from a general rate case
filed after December 2006.
YOU ARE FURTHER NOTIFIED that the Company wishes to capitalize the costs
of the severance program in accordance with paragraph 9 of SFAS No. 71. The cost of the
MEHC Transition would then be amortized on a straight-line basis over a three-year period. The
Company states that this amortization is appropriate because the MEHC Transition activities are
concentrated in the first several months while the benefits of the transition are realized over a
longer timeframe. According to the Company, charging the transition costs in the period they
are incurred would be unfair to existing customers for the benefit of future customers; thus
capitalizing the costs and amortizing them supports the matching principle for costs and benefits.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 30176
YOU ARE FURTHER NOTIFIED that the Company anticipates that its costs related
to employee severance will exceed $25 million on a total Company basis. It also estimates that
the cost of adapting the software will fall between $500 000 and $1 000 000. The Company
proposes that the MEHC Transition costs be charged to Account 182.3 Other Regulatory Assets
and that they be amortized to Account 930.2 Miscellaneous General Expenses. It proposes to
include the unamortized amounts in its rate base where they would earn a return at the
Company s authorized rate of return. If the Application is not granted, these costs would be
charged to the Company s operations and maintenance accounts. The Company does not request
a determination of ratemaking treatment of the MEHC Transition costs in this Application;
rather, it proposes to address the recovery of these costs in its next rate case.
NOTICE OF MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has reviewed the
Application in this case and has preliminarily determined that the public interest in this matter
may not require a hearing to consider the issues presented, and that the issues raised by the
Application may be processed under Modified Procedure , by written submission rather
than by hearing. IDAP A 31.01.0 1.21 0-204. The Commission notes that Modified Procedure
and written comments have proven to be an effective means for obtaining public input and
participation.
YOU ARE FURTHER NOTIFIED that the deadline for filing written comments or
protests with respect to Rocky Mountain Power s Application and the use of Modified
Procedure in this case is forty-five (45) days from the service date of this Order. The comment
must contain a statement of reasons supporting the comment. Persons desiring a hearing must
specifically request a hearing in their written comments. Written comments concerning this
Application shall be mailed to the Commission and the Applicant at the addresses reflected
below:
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 30176
Idaho Public Utilities Commission
Commission Secretary
PO Box 83720
Boise, ID 83720-0074
Street Address for Express Mail:
472 W. Washington Street
Boise, Idaho 83702-5983
Dean Brockbank, Esq.
PacifiCorp
201 S. Main, Suite 2200
Salt Lake City, UT 84111
E-mail: dean. brockbank(fYpacificorp.com
Brian Dickman
PacifiCorp dba Rocky Mountain Power
201 S. Main, Suite 2300
Salt Lake City, UT 84111
E-mail: brian.dickman(fYpacificorp.com
These comments should contain the case caption and case number shown on the first page of this
document. Persons desiring to submit comments via e-mail may do so by accessing the
Commission s home page located at www.puc.idaho.gov. Click the "Comments and Questions
icon, and complete the comment form using the case number as it appears on the front of this
document. These comments must also be sent to Rocky Mountain Power at the e-mail addresses
listed above.
YOU ARE FURTHER NOTIFIED that the Application has been filed with the
Commission and is available for public inspection during regular business hours at the
Commission offices. The Application is also available on the Commission s Website at
www.puc.idaho.gov under the "File Room" icon and then "Electric Cases.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are
received within the time limit set, the Commission may consider the matter on its merits and may
enter its Order without a formal hearing. If written comments or protests are received within the
deadline, the Commission will consider them and in its discretion may set the matter for hearing
31.01.01.204.
or may decide the matter and issue its Order based on the written comments before it. IDAP
YOU ARE FURTHER NOTIFIED that the Commission has jurisdiction over this
matter pursuant to Title 61 of the Idaho Code, and specifically Idaho Code ~~ 61-524.
ORDER
IT IS HEREBY ORDERED that the Application of PacifiCorp dba Rocky Mountain
Power be processed by Modified Procedure, IDAPA 31.01.01.201-204. Persons interested in
submitting written comments in this matter must do so no later than forty-five (45) days from the
service date of this Order.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 30176
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
day of November 2006.
ATTEST:
Je D. Jewell
Co mission Secretary
O:PAC-06-
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 30176
MARSHA H. SMITH, COMMISSIONER