20150212notice_of_application_order_no_33228.pdf

Office of the Secretary
Service Date
February 12,2015
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF ROCKY MOUNTAIN POWER FOR )CASE NO.PAC-E-I5-O1
AUTHORITY TO INCREASE RATES BY )
S1O.7 MILLION TO RECOVER DEFERRED )NOTICE OF APPLICATION
NET POWER COSTS THROUGH THE )
ENERGY COST ADJUSTMENT )NOTICE OF
MECHANISM (ECAM))INTERVENTION DEADLINE
)
_______________________________
)ORDER NO.33228
YOU ARE HEREBY NOTIFIED that.on February 2,2015,PacifiCorp dba Rocky
Mountain Power (“Rocky Mountain”or “Company”)submitted its annual Energy Cost
Adjustment Mechanism (“ECAM”)filing in accordance with Idaho Code §61-502 and 61-503,
and Rule of Procedure 52,IDAPA 31.01.01.052.
YOU ARE FURTHER iOTIFIED that Rocky Mountain is requesting a Commission
Order approving the recovery of total deferred net power costs of $16.6 million for the period
beginning December 1.2013 through November 3,2014 (“Deferral Period”).Rocky Mountain’s
Application seeks to revise Schedule 94,Energy Cost Adjustment,to recover approximately
$23.3 million in total deferred net power costs over the collection period beginning April 1,2015
through March 31,2016.The proposed $23.3 million recovery represents an increase of
approximately $10.7 million from current Schedule 94 rates,as approved in Commission Order
No.33008 (Case No.PAC-E-14-Ol).The Company states further that the $23.3 million
recovery amount includes an amortization of Monsanto Company’s (Monsanto”)and Agrium
Inc.’s (“Agrium”)share of 2012-2014 deferrals.
YOU ARE FURTHER NOTIFIED that the combined amortization of the amounts for
the three ECAM deferral periods resulted in an increase in the tariff surcharge rates in this case
of approximately $12.7 million and $1.0 million respectively for Monsanto and Agrium as their
share in the Deferral Period.
YOU ARE FURTHER NOTIFIED that Rocky Mountain explained in its Application
that the Commission established an annual ECAM through Order No.30904.The costs included
in the ECAM are net power costs (“NPC”),as defined in the Company’s general rate cases and
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modeled by the Company’s GRID model.Base and actual NPC are booked into specific FERC
accounts outlined in the Application.The ECAM process allows the Company to credit or
collect the difference between the actual NPC incurred to serve its Idaho customers and the NPC
collected through rates.Rocky Mountain defers the difference into an ECAM balancing account.
YOU ARE FURTHER NOTIFIED that the Company further noted that the ECAM
includes five additional components:the Load Growth Adjustment Rate (“LGAR”)or Load
Change Adjustment Rate (“LCAR”),a credit for S02 allowance sales,an adjustment for the
treatment of coal stripping costs,a renewable resource adder for the renewable resources that are
not yet in rate base and a true-up of renewable energy credit (“REC”)revenues,as authorized by
the Commission in Order No.32196.The ECAM includes a 90%(customers)/10%(Company)
“sharing band”wherein customers pay/receive the increase/decrease in actual NPC compared to
base NPC and Rocky Mountain incurs/retains the remaining 10%.
YOU ARE FURTHER NOTIFIED that Rocky Mountain states that the Base NPC in
this case originated from the 2011 stipulation approved by the Commission.The Base NPC was
set at $l.385 billion for the Deferral Period.
YOU ARE FURTHER NOTIFIED that the NPC deferral amount is calculated on a
monthly basis by subtracting the monthly Base NPC rate from the Actual NPC rate.The NPC
rate is calculated by dividing monthly NPC by the corresponding monthly load to express the
costs on a dollar per megawatt-hour (MWh)basis.According to the Company,the average Base
NPC was $23.73 per MWh and the Actual NPC averaged $27.05 per MWh,a difference of $3.32
MWh.The monthly incremental difference is then multiplied by Idaho’s actual load during the
Deferral Period.For the 12-month period ending November 30,2014,the NPC differential for
deferral was approximately $12.7 million before application of the 90/10%sharing band.The
LCAR decreased the deferral balance by $619,086,before sharing,due to higher usage during
the Deferral Period.
YOU ARE FURTHER NOTIFIED that credits for S02 allowance sales revenues
received by Rocky Mountain were also included as an offset to the NPC deferral ($71 before
sharing).Additionally,Idaho’s share of incremental load control costs,pursuant to Commission
Order No.32432,is tracked in the ECAM and resulted in an adjustment increasing the deferral
by approximately $1.0 million before sharing.
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YOU ARE FURTHER NOTIFIED that the difference between including coal
stripping costs incurred by the Company and recorded on the Company’s books pursuant to
accounting pronouncement EITF 04-6,and the amortization of the coal stripping costs when the
coal was excavated,decreased the deferral by $66,928 before sharing.
YOU ARE FURTHER NOTIFIED that the total NPC deferral adjusted for the
aforementioned LCAR,SO2 revenue,load control,and EITF 04-6 is $13.0 before application of
the sharing band and $11.7 million after its application.Additionally,the deferral balance
reflects the difference between actual REC revenues during the Deferral Period and the amount
of REC revenues included in base rates.The REC revenue true-up included in the ECAM is
symmetrical but no sharing band is applied.During the Deferral Period actual REC revenue was
approximately $6.0 million lower than the amount in base rates on an Idaho-allocated basis.
YOU ARE FURTHER NOTIFIED that,pursuant to Order No.33008,Rocky
Mountain performed a back cast calculation in order to establish whether there was an
over/under-collection of NPC,load control costs,and RECs,reducing the total deferral by
approximately $1.2 million and making the net deferral S16.5 million before interest.
Approximately $0.1 million of interest was accrued on this balance during the deferral period for
a final deferral of $16.6 million.
YOU ARE FURTHER NOTWIED that Rocky Mountain explained in its Application
that the deferred ECAM balance of $27.0 million as of November 30,2014,is derived from
$10.4 million in uncollected deferrals from prior ECAM filings plus the components described
above.Interest of 1%annually and totaling $0.3 million was added to the uncollected balances.
Exhibit 1 of the Application illustrates the detailed calculations for tariff customers,with an
ending balance of $1.8 million;Monsanto,with an ending balance of $8.0 million;and Agrium,
with an ending balance of $0.6 million.
YOU ARE FURTHER NOTIFIED that Rocky Mountain’s Application includes the
direct testimony of Company witnesses Michael Wilding and Joelle Steward.Mr.Wilding’s
testimony details the Company’s back cast calculation.Ms.Steward’s testimony describes the
calculation of the proposed Schedule 94 rates.Exhibit 2 of Ms.Steward’s testimony illustrates
this calculation based on metered loads,the line loss adjusted loads,the allocation of the ECAM
price change,and the percentage change by rate schedule based on the present revenues ordered
in Case No.PAC-E-13-04.Exhibit 3 of her testimony is a summary of the ECAM balances
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detailing the current deferral,prior deferred balances,ECAM rider revenues and an estimate of
the net expected balance as of April 1,2015.Exhibit 4 is a clean and legislative copy of Electric
Service Schedule No.94 containing the proposed rates by electric service schedule based on the
customer’s delivery voltage of electric service.
YOU ARE FURTHER NOTIFIED that Rocky Mountain intends to notify customers
of its filing by “issuing a press release sent to local media organizations and messages in
customer bills over the course of a billing cycle”beginning February 12,2015.Copies of the
press release and bill insert were included in the Company’s Application.Copies of Rocky
Mountain’s Application are available for review at the Company’s local offices in its Idaho
service territory.
YOU ARE FURTHER NOTIFIED that the Application,exhibits,and testimonies
have been filed with the Commission and are available for public inspection during regular
business hours at the Commission offices.The Application,exhibits,and testimonies are also
available on the Commission’s web site at Click on the “File Room”tab at
the top of the page,scroll down to “Open Electric Cases,”then click on the case number as
shown on the front of this document.
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 specifically
Idaho Code §6 1-503 and 6 1-328.The Commission may enter any final Order consistent with
its authority under Title 61.
YOU ARE FURTHER NOTIFIED that all hearings will be conducted pursuant to the
Commission’s Rules of Procedure,IDAPA 3 1.01.01.000 et seq.
NOTICE OF INTERVENTION DEADLINE
YOU ARE FURTHER NOTIFIED that persons desiring to intervene in this matter
must file a Petition to Intervene with the Commission pursuant to this Commission’s Rules of
Procedure 72 and 73,IAPA 31.01.01.072 and -.073.All Petitions to Intervene must be filed
within fourteen (14)days from the service date of this Order.Persons desiring to present
their views without parties’rights of participation and cross-examination are not required to
intervene and may present their comments without prior notification to the Commission or the
parties.
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ORDER
IT IS HEREBY ORDERED that persons desiring to intervene in Case No.PAC-E
15-01 should do so no later than fourteen days from the date of this Order.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this /-
day of February 2015.
ATTEST:
Jtn D.JewelJ[J
Cmmission Secretary
MACK A.REDFORD,
MARSHA H.SMITH,COMMISSIONER
O:PAC-E-15-OLnp
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO.33228
PAUL
MMISSIONER
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