20130619notice_of_proposed_settlement_order_no_32831.pdf

Office of the Secretary
Service Date
June 19,2013
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF PACIFICORP DBA ROCKY MOUNTAIN )CASE NO.PAC-E-13-04
POWER TO INITIATE DISCUSSIONS WITH )
INTERESTED PARTIES ON ALTERNATIVE )NOTICE OF
RATE PLAN PROPOSALS )PROPOSED SETTLEMENT
)
)NOTICE OF SCHEDULE
)
)NOTICE OF PUBLIC HEARINGS
)
______________________________
)ORDER NO.32831
On March 1,2013,PacifiCorp dba Rocky Mountain Power (“Rocky Mountain”)filed
an Application requesting that the Commission open a case “to identify interested parties that
would like to participate [in]settlement discussions”regarding alternatives to the Company
filing a general rate case.Application at 1.
Accompanying the Application was Rocky Mountain’s “Notice of Intent”to file a
general rate case.Rule 122 requires certain utilities to file a notice of intent at least 60 days
before filing a general rate case.IDAPA 31.01.01.1-22.01.The Company acknowledges in its
Notice that it cannot file a general rate case before May 31,2013,and that rates resulting from
such rate case will not become effective until January 1,2014.Notice at 1;Order No.32432 at
6.
On March 12,2013,the Commission issued a Notice of Application and Intervention
Deadline directing Staff counsel to convene an informal prehearing conference so that the parties
may discuss a schedule for settlement conference and other preliminary matters.Order No.
32761 at 3.Subsequently.the Commission issued Orders granting intervention to Monsanto
Company (“Monsanto”);Idaho Irrigation Pumpers Association,Inc.(“JIPA”);Idaho
Conservation League (“ICL”);Snake River Alliance (“SRA”);PacifiCorp Idaho Industrial
Customers (“PIIC”);and Community Action Partnership Association of Idaho (“CAPAI”).See
Order Nos.32761,32779.
On April 19,2013 and May 2,2013,representatives of Rocky Mountain,Staff,
Monsanto,JIPA,ICL,SRA,PIIC,and CAPAI met at the Commission offices and participated in
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informal settlement discussions.On June 3,2013,the Company filed a Stipulated Settlement
Agreement (“Stipulation”)signed by all of the parties.except CAPAI,that proposes,in lieu of a
general rate case filing by the Company,to implement a two-year rate plan beginning on January
1,2014.
NOTICE OF PROPOSED SETTLEMENT
YOU ARE FURTHER NOTIFIED that the following is a summary of the relevant
terms of the parties’Stipulation:
Base Rates
1.The parties agree that the Stipulation is filed in lieu of a general rate case.
Rocky Mountain agrees that it will not file another general rate case before
May 31,2015,with new rates not effective prior to January 1,2016.
2.The parties agree that the base revenue requirement for all customer
schedules will increase by a uniform percentage of 0.77%in the energy
rate of each schedule.New rates will be effective on January 1,2014.
3.These rates allow recovery of the 27%of the Populus to Terminal
transmission line investment that was deemed plant held for future use in
Order No.32196.Commission Order No.32432 determined that this
investment is now used and useful and shall be included in rates on or
after January 1,2014.The base rate increase is designed to collect
approximately $2.0 million annually from Idaho customers.
ECAM
4.The parties agree to the inclusion of and paying for a resource adder for
the Lake Side II generation facility that will be recovered through the
ECAM at 100%,for the period that the investment in the facility is not
reflected in rates as a component of rate base,beginning January 1,2015,
subject to the Lake Side II generation facility having achieved commercial
operation as of that date.The ECAM deferral will be determined by
multiplying the actual megawatt-hours of generation from the Lake Side II
generation facility by $1.99 per megawatt-hour Idaho Resource Adder.
The recovery of the Lake Side II resource adder will be capped after
the first 2,729,500 megawatt-hours of generation,or recovery of
approximately $5.43 million from Idaho customers through the
ECAM.Pursuant to Commission Order No.32771,the parties have
agreed to modify the ECAM calculation by removing the wholesale
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sales line loss adjustment from Monsanto and Agrium’s actual load
used to calculate all deferral balances except for the Load Change
Adjustment Revenue (LCAR)portion of the ECAM deferral.This
change will be effective for the ECAM deferral period starting June 1,
2013 and ending on November 30,2013.
Effective December 1,2013,the ECAM deferral will be calculated on
a total Idaho basis;Monsanto and Agrium’s share will not be
calculated and deferred separately.The rates will be designed based
on energy sales data.Specifically,as in past ECAMs,the proposed
rates will be calculated by effectively dividing the total target amount
for Idaho customers by the energy sales data at their appropriate
delivery voltage levels.
DEPRECIATION STUDY AND CARBON PLANT
5.The parties request Commission approval of the proposed accounting
treatment for the Company to establish a regulatory asset that would allow
the Company to defer,on a monthly basis,any aggregate net increase or
decrease in Idaho allocated depreciation expense for the period beginning
on the latter of January 1,2014,or the effective date in the Commission
Order approving new depreciation rates,until the date that new
depreciation rates are reflected in customer rates.
6.The parties agree that the Company will be allowed to recover or be
required to refund the deferred depreciation expense beginning on the
effective date of the next general rate case.The balance shall be
amortized over a period not to exceed 10 years from the effective date of
the next rate case.The parties agree that depreciation of the Carbon Plant
should not be included in this deferral.
7.Commission Order No.32701 authorized the Company to create a
regulatory asset to transfer the remaining Carbon Plant balances upon
retirement from electric plant in service and accumulated depreciation to
be amortized from the date of transfer to the regulatory assets through
December 31,2020.The regulatory asset as of the date of transfer will
include the undepreciated book balance assuming that existing
depreciation rates were used prior to the plant retirement date.The
difference between the depreciation rate effective in 2014 and the current
depreciation rate based on the prior decommissioning date of 2020 will be
included in the Remaining Carbon Balances regulatory asset until Carbon
depreciation rates are updated in the next general rate case.
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8.The parties agree to the creation of a regulatory asset for future recovery
from Idaho ratepayers of Idahos allocated share of the prudently incurred
Carbon Removal Costs.The projected removal costs were identified in
the calculation of the new depreciation expense as part of Case No.PAC
E-13-02,which is subject to Commission review and approval.
9.The parties agree that the Company shall be allowed to recover from
customers Idaho’s share of the prudently incurred Carbon Removal Costs
over a reasonable period determined by the Commission in a future
proceeding.The amortization of the Carbon Removal Costs will begin
when the amortization expense is included in rates in the next general rate
case.
MONSANTO CONTRACT
10.The parties agree that a new Electric Service Agreement (“ESA”)between
the Company and Monsanto will replace the Agreement set to expire on
December 31,2013,and shall begin on January 1,2014,with an initial
term through December 31,2015;the ESA shall include a new section
allowing for an Interruptible Credit Annual True-up;the ESA shall include
the increase associated with the Populus to Terminal Transmission line
described above;Monsanto and the Company agree to prepare and execute
an ESA that reflects these changes to the contract and provide it to the
Commission for approval;Monsanto and the Company will continue to
work collaboratively and in good faith to address the terms and conditions
and to optimize the value of Monsanto’s curtailment products to Monsanto
and the Company,including a discussion of cost of service methodologies
as applied to the Monsanto load and how said methodologies could be
utilized in the next general rate case.Monsanto and the Company will
report to the Staff and Commission as appropriate on the progress made.
RATE DESIGN
11.If CAPAI is a signatory to the Stipulation,the parties agree to the
following:the parties agree to conduct a rate design collaborative process
to evaluate potential changes to rate design for the Company’s residential
service,Schedule 1,and general service,Schedule 6 and 23.The parties
further agree to meet within one month after the Stipulation is filed to
begin the collaborative discussions.If CAPAI is not a signatory to the
Stipulation,the parties agree that this Paragraph is of no effect and does
not apply.’
As of the release date of this Order,CAPAI is not a signatory to the Stipulation.
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YOU ARE FURTHER NOTIFIED that the Stipulation and the Company’s
Application,in Case No.PAC-E-13-04 have been filed with the Commission and are available
for public inspection during regular business hours at the Commission offices,472 W.
Washington Street.Boise,Idaho.The Application and Stipulation are also available on the
Commission’s web site at www.puc.idaho.gov.Click on the “File Room”tab at the top of the
page,scroll down to “Open Electric Cases,”and then click on Case No.PAC-E-13-04.
YOU ARE FURTHER NOTIFIED that the Commission is not bound by any
settlement reached by the parties.The Commission will independently review any proposed
settlement to determine whether the settlement is just,fair and reasonable,and in the public
interest,or otherwise in accordance with law or regulatory policy.The Commission may accept
the settlement,reject the settlement,or state additional conditions under which the settlement
will be accepted.IDAPA 31.01.01.274-.276.
NOTICE OF SCHEDULE
YOU ARE FURTHER NOTIFIED that pursuant to agreement between the parties the
following scheduling has been adopted for the filing of testimony in this case:
August 16,2013 Deadline for filing direct testimony in support
of/opposition to the Proposed Settlement
August 30,2013 Deadline for filing rebuttal testimony
The prepared testimony and exhibits must conform to the requirements of Rules 231,
266 and 267 of the Commission’s Rules of Procedure.Reference IDAPA 3 1.01.01.231 and
.266-267.The above deadlines are for testimony and exhibit filing with the Commission.E
copy service on parties of record should be made on the same date to the extent practicable with
full service of testimony and exhibits provided to parties of record no later than the following
business day.
The parties are apprised that discovery is available pursuant to Commission Rules of
Procedure,IDAPA 31.01.01.221-234.The parties should coordinate discovery requests and
responses so that they are able to comply with the established prefile deadlines.No party
submitting testimony pursuant to prefile deadline shall be required to respond to discovery
within a five working day window preceding the prefile deadline.
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NOTICE OF PUBLIC HEARINGS
YOU ARE FURTHER NOTIFIED that the Commission will hold a public hearing
for Rocky Mountain customers on TUESDAY,AUGUST 27,2013,AT 7:00 P.M.,RIGBY
CITY HALL,158 W.FREMONT,RIGBY,IDAHO.The purpose of the public hearing is for
the Commission to take the formal testimony of customers and interested members of the public.
Testimony will be recorded and made part of the Commission’s formal record.The Company’s
customers and interested members of the public are encouraged to participate and give
testimony.
YOU ARE FURTHER NOTIFIED that the Commission will hold a telephonic public
hearing for Rocky Mountain customers on WEDNESDAY,AUGUST 28,2013,AT 7:00 P.M.,
IDAHO PUBLIC UTILITIES COMMISSION HEARING ROOM,472 W.
WASHINGTON,BOISE,IDAHO.The purpose of the telephonic public hearing is for the
Commission to take the formal testimony of customers and interested members of the public.
Testimony will be recorded and made part of the Commission’s formal record.The Company’s
customers and interested members of the public are encouraged to participate and give
testimony.
YOU ARE FURTHER NOTIFIED that persons wishing to offer testimony
telephonically or listen to the proceedings may dial the following toll-free number:(1-800-920-
7487)followed by the Participant Code (76373262#).The telephonic hearing will be held in
the following manner:
•All participants will be able to hear the proceeding;
•A participant’s phone will be automatically muted except when testifying;
•If you would like to testify,press *1 (star one)on your phone key pad.
This will sign you up (put you in the queue)to testify;
•When it is your turn to testify,you will hear the prompt ‘ask your
question.”At that time,you will be sworn in,asked to state your full
name,spell your last name,and give your full address;
•When you testify please be sure to eliminate any background noise,such
as the TV,radio,etc.,in order that your testimony can be heard clearly and
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recorded by the court reporter.At the conclusion of your testimony you
may be asked questions;
•If at any time after you sign up to testify,you decide that you do not want
to testify,simply push the #(pound)key on your phone and you will be
taken (out of the queue)off the list to testify.
YOU ARE FURTHER NOTIFIED that all hearings in this matter will be held in
facilities meeting the accessibility requirements of the Americans with Disabilities Act (ADA).
Persons needing the help of a sign language interpreter or other assistance in order to participate
in or to understand testimony and argument at a public hearing may ask the Commission to
provide a sign language interpreter or other assistance at the hearing.The request for assistance
must be received at least five (5)working days before the hearing by contacting the Commission
Secretary at:
iDAHO PUBLIC UTILITIES COMMISSION
P0 BOX 83720
BOISE,IDAHO 83720-0074
[phone] (Telephone)
[phone] (FAX)
E-mail:secretarypuc.idaho.gov
YOU ARE FURTHER NOTIFIED that all proceedings in this case will be held
pursuant to the Commission’s jurisdiction under Title 61 of the Idaho Code and that the
Commission may enter any final Order consistent with its authority under Title 61.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be
conducted pursuant to the Commission’s Rules of Procedure,IDAPA 3 1.01.01.000 etseq.
ORDER
IT IS HEREBY ORDERED that public hearings in the instant case shall be convened
on the dates and times described above.
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DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this I’?
day of June 2013.
PAUL KJEL A R,PRESIDENT
MACK A.RE ORD,SIONER
MARSHA H.SMITH,COMMISSIONER
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