20140123final_order_no_32967.pdf

Office of the Secretary
Service Date
January 23.2014
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF ROCKY MOUNTAIN POWER FOR )CASE NO.PAC-E-13-15
APPROVAL OF A CUSTOMER CREDIT TO )
REFUND OVER-COLLECTION OF )ORDER NO.32967
CUSTOIER EFFICIENCY SERVICES RATE )
On November 7,2013,Rocky Mountain Power filed an Application requesting
approval of a one-time customer bill credit to refund approximately $1.4 million to customers
effective February 1,2014.The proposed refund results from the Company’s over-collection of
funds for its demand-side management (DSM)programs.Rocky Mountain deposits customer
contributions collected through its Schedule 191 Customer Efficiency Services Rate into a Rider
account to fund its conservation programs.
Since 2006,Schedule 191 funds DSM programs through a percentage rate charged on
customers’monthly bills.In Case No.PAC-E-l2-I 1,the Company received Commission
approval effective August 1,2012,to decrease the Schedule 191 rate to reduce a growing surplus
in the Rider account.In that filing,the Company projected revenues of $4.54 1 million from
Schedule 191 during the year,and instead collected $5.245 million.Application,p.4.The
Company projects an over-collection during 2013 of $710,200,resulting in an accumulated
balance of $1.5 million as of December 31,2013.If no adjustment is made to the Schedule 191
rate,Rocky Mountain projects a balance at year-end 2014 of $2.3 million.Application,p.5.
The Company proposes to implement the bill credit through a new electric service
Schedule 95,Customer Efficiency Services Credit.Schedule 95 would apply to each active
retail customer as of February 1,2014,that paid the Schedule 191 rate and incurred charges from
October 1,2012 through September 30,2013.The Company proposes to apply the bill credit
beginning February 1,and complete the customer credits no later than March 31,2014.
On November 27,2013,the Commission issued a Notice of Application and Notice
of Modified Procedure establishing a period for interested parties to file written comments and
reply comments.Written comments were filed only by Staff,and no reply comments were filed.
Tariff Rider
Rocky Mountain Power historically has aligned the revenue collected for energy
efficiency expenses with actual (and forecasted)expenditures.The Company’s Schedule 191
ORDER NO.32967 1
rate was initially set at 1.5%in 2006 and increased to 3.72%in May 2008.Order No.30543.Tn
February 2010,Rocky Mountain filed an application requesting an increase to 5.85%,but the
Commission approved a rate of 4.72%.Order No.32023.The Commission approved changes
for funding the Company’s dispatchable irrigation load control program in the Company’s next
general rate case,resulting in a reduction to the Schedule 191 rate to 3.4%.Order No.32196.In
May 2012,the Company filed an application to reduce the collection rate from 3.4%to 2.1%,
anticipating the reduction would result in annual revenue collections of $3.5 million.As of
September 30,2013,the Company had a credit balance in the tariff rider account of
approximately $1.4 million and projected a credit balance of $1.5 million on December 31,2013.
Staff Review
Staff in its comments reviewed the Company’s Application and supplemental
information and supports the Company’s proposal to issue a one-time customer credit of
approximately $1.4 million.Staff concluded the credit will refund the over-collection of Rider
revenue to customers,but will not impair the Company’s ability to pursue all cost-effective
DSM.Because the Rider rate is applied to a customer’s overall bill,Staff concluded a one-time
bill credit better matches the refunded amount to the individual contributor.
Staffs analysis confirms that the credit balance in the DSM tariff rider account
resulted from an increase in revenues and not a decrease in DSM expenditures.Although the
Company’s actual DSM expenditures exceeded its projection,heavy summer loads during 2012
and 2013 resulted in higher than forecasted rider revenues.During the months of June through
August 2012,actual tariff Rider revenues exceeded forecasts by $772,463.For those same
months in 2013,an additional $351,622 over forecasted revenues was collected by the Company.
Although 2013 DSM expenses decreased slightly when compared to 2012 levels,the Company’s
actual DSM expenses exceeded its forecasts by more than $200,000 during the same period.
The Company proposed a pro rata bill credit based on the amount a customer
contributed to the Rider to determine the credit for each customer.During the period of October
2012 through September 2013,the Company collected Rider revenues of $3,786,656 from active
customers.A refund of $1.4 million is 37%of the Rider revenues collected during that 12-
month period.Thus,the Company proposed to issue a bill credit to each customer equal to 37%
of the amount that each individual customer paid into the Rider during those 12 months,resulting
ORDER NO.32967 2
in an average residential bill credit of $8.32.The Company also proposed the Commission adopt
a new tariff schedule to describe the one-time bill credit.
Based on the record presented,the Commission approves Rocky Mountain’s
Application to refund $1.4 million in excess DSM program funds to customers.The record
makes clear the amount to be refunded is above anticipated program costs,and that the proposed
one-time bill credit will not impact the Company’s future DSM expenditures or energy savings.
The Company projects DSM spending through 2014 to remain constant with a forecasted
increase in 2015.Providing a one-time credit to customers without adjusting the Schedule 191
rate will ensure adequate Rider funds for anticipated DSM program costs.We decline to
approve the temporary Schedule 95,however,and instead direct the Company to issue customer
credits as set forth in its Application,beginning February 1,2014.The administrative work
associated with a short-lived tariff creates an unnecessary administrative burden for both the
Company and Commission Staff.
ORDER
IT IS HEREBY ORDERED that Rocky Mountain’s Application to issue a one-time
bill credit to refund approximately $1.4 million to customers that were subject to Schedule 191
from October 1,2012 to September 30,2013,beginning February 1,2014,is approved.The
Company is directed to issue customer credits as set forth in its Application beginning February
1,2014.
THIS IS A FINAL ORDER.Any person interested in this Order may petition for
reconsideration within twenty-one (21)days of the service date of this Order.Within seven (7)
days after any person has petitioned for reconsideration,any other person may cross-petition for
reconsideration.See Idaho Code §6 1-626.
ORDER NO.32967 3
DONE by Order of the Idaho Public Utilities Commission at Boise.Idaho this
day of January 2014.
PAUL KJE[i.ANDER.PRESIDENI
ATTEST:
JeanD JeeIl
Commission Secretary
bIs/O:IPC-E1 3-1 lws2
—I
MARSHA H.SMITH,COMMISSIONER
MACK A.REDFOi SSIONER
ORDER NO.32967 4