20171130notice_of_proposed_settlement_order_no_33939.pdf

Office of the Secretary
Service Date
November 30,2017
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )CASE NO.PAC-E-17-06
OF ROCKY MOUNTAIN POWER FOR A )CERTIFICATE OF PUBLIC )NOTICE OF
CONVENIENCE AND NECESSITY AND )PROPOSED SETTLEMENT
BINDING RATEMAKING TREATMENT )FOR NEW WIND AND TRANSMISSION )NOTICE OF
FACILITIES )MODIFIED PROCEDURE
)NOTICE OF COMMENT
)DEADLINE
)ORDER NO.33939
On July 3,2017,Rocky Mountain Power applied for Commission approval of the
Company's plan to upgrade,or "repower,"its existing wind resources,and of the associated rate-
making treatment.The Company claimed that repowering its wind resources would increase
production,reduce costs,and qualify the Company for federal production tax credits (PTCs).The
Company estimated that upgrades to the system would increase output by about 19%with no
additional facilities.The Company further estimated that the project would cost approximately
$1.13 billion.
On August 18,2017,the Commission issued a scheduling order for a settlement
conference,prefiled testimony deadline,rebuttal deadline,and a technical hearing date.Order
No.33850.Monsanto,the Idaho Irrigation Pumpers Association,and the PacifiCorp Idaho
Industrial Customers timely intervened.On October 2,2017,the parties reported that a
settlement had been reached,and by request,the Commission vacated the pending testimony
deadlines.Order No.33927.On November 24,2017,the Company filed a settlement stipulation.
The parties requested that the proposed settlement be processed by Modified Procedure,with a
general comment deadline for all parties and the public of December 13,2017.
With this Order,we provide notice of the settlement,notice of modified procedure,
and set a comment deadline.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT DEADLINE
ORDER NO.33939 l
NOTICE OF PROPOSED SETTLEMENT
YOU ARE HEREBY NOTIFIED that the parties have entered into a settlement
stipulation to fully resolve the case,as summarized as follows:
1.Overview of Settlement'
If approved,PacifiCorp would be allowed ratemaking treatment for recovery of the
replacement of certain assets,new investment,incremental energy production,and production
tax credits ("PTC")associated with the wind repowering project through a Resource Tracking
Mechanism ("RTM")as a component of the Company's annual Energy Cost Adjustment
Mechanism ("ECAM").The RTM and ECAM will capture the costs and benefits of the
repoweredwind facilities until such time as they are recovered through a general rate case.
2.Resource TrackingMechanism
Customers will receive 100%of the benefit of the incremental energy produced by
the repowered facilities.Under the ECAM's existing sharing bands,benefits associated with
incremental energy production will be shared,with 90%credited to customers,and 10%to the
Company.Through the ECAM,the RTM will pass back to customers the Company's 10%
associated with the wind repowering project.
The RTM calculation will use a pretax return on investment rate of 10.4%,or an after
tax return on investment rate of 6.45%.The Company will begin deferring the cost and benefits
associated with the project in the first month after its in-service date.The Company has agreed to
maintain a cap in the RTM until its next general rate case where it may request,if appropriate,to
remove the cap.
3.Change in Circumstances
The parties have agreed,if there is a significant change in circumstances,such as
changes to the federal tax code,or a change in the projected costs or benefits to the project,that
the parties may initiate a further review before the Company proceeds any further.The
stipulation includes a "more favorable terms and conditions"clause allowingthe parties to
reconvene and amend the terms of this agreement,with Commission approval,if more favorable
terms are reached in Utah or Wyoming.
'The actual Stipulation and Settlement is more detailed than this summary.The complete Stipulation may be
viewedin its entirety on the Commission's web site.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT DEADLINE
ORDER NO.33939 2
4.Signing Parties
The Company,Commission Staff,Monsanto,the Idaho Irrigation Pumpers
Association,and the PacifiCorp Idaho Industrial Customers have all signed the Stipulation and
represent that it is in the public interest and is fair,just,and reasonable.
COMMISSION SETTLEMENT RULES
YOU ARE FURTHER NOTIFIED that the Commission will review the proposed
settlement consistent with Commission Rules 271-280.
YOU ARE FURTHER NOTIFIED that the Commission is not bound by the
agreement of the signing parties.The Commission will independently review the proposed
settlement to decide whether to approve it,reject it,or state conditions under which to accept it.
The proposed settlement's proponents ultimatelybear the burden to prove that it is just,fair,and
reasonable,in the public interest,or otherwise in accordance with law or regulatory policy.
YOU ARE FURTHER NOTIFIED that the Stipulation,Application,and supporting
workpapers,testimony,and exhibits are available for public inspection during regular business
hours at the Commission offices.The Application and accompanying documents are also
available on the Commission's Website at www.puc.idaho.gov under "File Room"and then
"Electric Cases."
NOTICE OF MODIFIED PROCEDURE
YOU ARE HEREBY NOTIFIED that the Commission has now determined that the
public interest may not require a formal hearing in this matter and will proceed under Modified
Procedure pursuant to Rules 201 through 204 of the Idaho Public Utilities Commission's Rules
of Procedure,IDAPA 31.01.01.201 through .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 any person or party desiring to state a
position on the Stipulation may file a written comment in support or opposition with the
Commission no later than December 13,2017.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 Stipulation shall be mailed to the
Commission and the Applicant at the addresses reflected below:
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT DEADLINE
ORDER NO.33939 3
Commission Secretary Ted Weston
Idaho Public Utilities Commission Rocky Mountain Power
P.O.Box 83720 1407 West North Temple,Suite 330
Boise,ID 83720-0074 Salt Lake City,UT 84116
email:[e-mail]
Street Address for Express Mail:
472 W.Washington Street Yvonne Hogle
Boise,ID 83702-5918 Rocky Mountain Power
1407 West North Temple,Suite 330
Randall C.Budge Salt Lake City,UT 84116
Racine Olson Nye &Budge email:[e-mail]
P.O.Box 1391
Pocatello,Idaho 83204 Eric Olsen
email:[e-mail] Echohawk &Olsen,PLLC
Idaho IrrigationPumpers Association,Inc.
Ronald L.Williams P.O.Box 6119
Williams Bradbury,P.C.Pocatello,ID 83205
P.O.Box 388 email:elo echohawk.com
Boise ID,83701
email :[e-mail]
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 "Case Comment or Question
Form"under the "Consumers"tab,and complete the comment form using the case number as it
appears on the front of this document.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are
received within the time limit set,the Commission will consider this matter on its merits and
enter its Order without a formal hearing.If written comments are received within the time limit
set,the Commission will consider them and,in its discretion,may set the same for formal
hearing.
O RD ER
IT IS HEREBY ORDERED that the parties'Stipulation be processed by Modified
Procedure,Rule 201-204 (IDAPA 31.01.01.201-.204).Persons interested in submitting written
comments must do so on or before December 13,2017.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT DEADLINE
ORDER NO.33939 4
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of November 2017.
PAUL KJÉLLAN R,PRESIDENT
KRI TINE RAPËR,CÒlÈMISSIONER
ERIC ANDERSON,COMMISSIONER
ATTEST:
Diane Hanian
Commission Secretary
I:\Legal\LORDERS\PACE1706 bk4.doc
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT DEADLINE
ORDER NO.33939 5