20200630Notice_of_Proposed_Settlement_Order_No_34714.pdf

NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34714 1

Office of the Secretary
Service Date
June 30, 2020
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

On September 11, 2018, Rocky Mountain Power, a division of PacifiCorp (“Rocky
Mountain Power” or “Company”) filed an Application seeking approval of its proposed changes
to depreciation rates applicable to the Company’s electric plant. The Company’s last depreciation
case, PAC-E-13-02, was approved by the Commission in 2013.
On October 5, 2018, the Commission issued a Notice of Application and Notice of
Intervention Deadline directing Staff and parties to discuss the appropriate scheduling for the case.
Monsanto, PacifiCorp Idaho Industrial Customers (“PIIC”), Idaho Irrigation Pumpers
Association, Inc., (“IIPA”) and Idaho Conservation League (“ICL”) intervened in this case.
On April 18, 2018, a technical conference was held in Boise, followed by several
meetings and conference calls where settlement discussions were held with parties.
On June 15, 2020, the Company filed a proposed Settlement Stipulation (“Settlement
Stipulation”) signed by the Company, Staff, Monsanto, PIIC, and IIPA (collectively the
“Stipulating Parties”)1. The Company, on behalf of the Stipulating Parties, requested the case be
processed by Modified Procedure.
The Commission now issues this Notice of Proposed Settlement and Notice of
Modified Procedure establishing deadlines for public comments and the Company’s reply.

1 Idaho Conservation League is not a Stipulating Party but does not oppose the Settlement Stipulation.

IN THE MATTER OF THE APPLICATION
OF ROCKY MOUNTAIN POWER FOR
AUTHORIZATION TO CHANGE
DEPRECIATION RATES APPLICABLE TO
ELECTRIC PROPERTY
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CASE NO. PAC-E-18-08

NOTICE OF PROPOSED
SETTLEMENT

NOTICE OF MODIFIED
PROCEDURE

ORDER NO. 34714

NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34714 2

NOTICE OF PROPOSED SETTLEMENT
YOU ARE HEREBY NOTIFIED that, in summary, the Stipulating Parties entered the
Settlement Stipulation on depreciation rates in resolution of all issues other than decommissioning
costs that will be addressed in a proposed Phase II in this case.2
YOU ARE FURTHER NOTIFIED that the Stipulating Parties agreed to depreciation
rates that would increase annual depreciation expenses allocated to Idaho by about $8.7 million.
The Stipulating Parties further agreed:
1. That the proposed depreciation rates in Attachments 1-3 of the Settlement
Stipulation are just and reasonable depreciation rates and would take effect
on January 1, 2021.

2. Cholla Unit 4 would be removed from electric plant in-service as of
December 2020 and ratemaking treatment for unrecovered plant balances,
decommissioning, and other closing costs would be addressed in Case No.
PAC-E-20-03.

3. To recognize the conversion of Naughton Unit 3 to natural gas with a
retirement date of December 2029. Additionally, Naughton Units 1 and 2
would reflect the filed retirement date of December 2029.

4. Any solar and/or battery storage assets acquired or developed by the
Company before its next depreciation study is filed would use a 25-year
lifespan based on Iowa Curves and Net Salvage values in Table 3 of the
Settlement Stipulation.

5. The Company would defer the changes in depreciation expense from current
rates, $13,940,303, for one year through December 31, 2020. This amount
includes about $8.7 million of the Idaho jurisdictional allocation for the
depreciation study, about $3.2 million of excess reserve amortization in rates
that end as of the effective date of the depreciation study, and about $2.0
million for the incremental increase from 2013 depreciation study not yet
reflected in rates. The Company would defer $1,161,692 per month for 12
months in a regulatory asset account for recovery to be determined in the
Company’s next general rate case. No carrying charge would be applied to
the regulatory asset during the deferral period until the next general rate case.
A carrying charge or rate base treatment after the deferral period and the
amortization period would be determined in the Company’s next general rate
case. The depreciation expense tracked in the RTM would be calculated
using the depreciation rates provided in Case No. PAC-E-13-02, Order No.

2 The actual Stipulation, including its attachments, is about 35 pages long and includes much more detail than the summary provided here.

NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34714 3

32926, to eliminate any double counting. The Company would also stop
deferring incremental depreciation expense from PAC-E-13-02 currently
recovered in the Energy Cost Adjustment Mechanism effective December
31, 2020.

6. If the Company decides to retire any thermal plant besides Cholla Unit 4
before its next depreciation study, the Company will not seek to shorten the
cost recovery period for such thermal plant prior to the approval of its next
depreciation study.

7. The Company agrees to present an analysis supporting the proposed lives
and net salvage value for all Company-owned wind resources in its next
depreciation study.

8. To support a Phase II in this case which will evaluate incremental
decommissioning costs filed with the Commission on January 17, 2020 and
March 16, 2020 (collectively “2020 Decommissioning Studies”) and
appropriate ratemaking treatment. The Settlement Stipulation proposes to
complete the review of the regulatory treatment of the 2020
Decommissioning Studies in Phase II in time to allow the Commission to
issue a final order before December 31, 2020.

YOU ARE FURTHER NOTIFIED that any reference to other States in the Settlement
Stipulation is for illustrative purposes only and does not purport to bind other State Commissions.
YOU ARE FURTHER NOTIFIED that the Stipulating Parties are not able to agree that
each specific component of this Settlement Stipulation is just and reasonable in isolation, all of the
Stipulating Parties agree that this Settlement Stipulation as a whole is just and reasonable in result
and in the public interest.
YOU ARE FURTHER NOTIFIED that the Stipulating Parties agree that if any person
challenges the approval of this Settlement Stipulation or requests rehearing or reconsideration of
any order of the Commission approving this Settlement Stipulation, each Stipulating Party will use
its best efforts to support the terms and conditions of this Settlement Stipulation. In the event any
person seeks judicial review of a Commission order approving this Settlement Stipulation, no
Stipulating Party shall take a position in that judicial review proceeding in opposition to the
Settlement Stipulation.
YOU ARE FURTHER NOTIFIED that the Settlement Stipulation in Case No. PAC-
E-18-08 has been filed with the Commission and is available for public inspection during regular

NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34714 4

business hours at the Commissions office3 (address below). The Company’s Application is also
available on the Commission’s web site at www.puc.idaho.gov. Click on the “ELECTRIC” tab in
the left-hand column of the home page, click “Open Cases,” click on the case number as shown
on the front of this document. You then may access the Stipulation by clicking on “Stipulation on
Depreciation Rate Changes.PDF” under the “Company” heading.
YOU ARE FURTHER NOTIFIED that the Commission is not bound by the Settlement
Stipulation 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 a
settlement, reject a settlement, or state additional conditions under which a settlement will be
accepted. IDAPA 31.01.01.274-.276.
NOTICE OF MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has determined that the public
interest may not require a formal hearing in this matter, and that it will proceed under Modified
Procedure pursuant to Rules 201 through 204 of the 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 desiring to state a position on this
Settlement Stipulation must file a written comment in support or opposition with the
Commission within 21 days of 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 Settlement Stipulation
should be emailed to the Commission and the Company at the addresses reflected below. If e-mail
is unavailable, written comments can be mailed to the addresses reflected below:

3 Interested persons are encouraged to view the actual Stipulation on the Commission’s web site, if possible.

NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34714 5

For the Idaho Public Utilities
Commission:

Commission Secretary
Idaho Public Utilities Commission
P.O. Box 83720
Boise, ID 83720-0074

Street Address for Express Mail:

11331 W. Chinden Blvd.
Bldg. 8, Ste. 201-A
Boise, ID 83714

[e-mail]
For Rocky Mountain Power:

Ted Weston
Emily Wegener
Rocky Mountain Power
1407 W. North Temple, Suite 330
Salt Lake City, UT 84116

[e-mail]
[e-mail]

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 “Case Comment Form” tab
then click the “Case Comment Form” under “Consumers” and complete the comment form using
the case number as it appears on the front of this document.
YOU ARE FURTHER NOTIFIED that the Company must file any reply comments
within 28 days of the service date of this Order.
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 an 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 R D E R
IT IS HEREBY ORDERED that the proposed Settlement Stipulation be processed by
Modified Procedure, Rule 201-204 (IDAPA 31.01.01.201-.204). Persons interested in submitting
written comments must do within 21 days of the service date of this Order. The Company must
file any reply comments within 28 days of the service date of this Order.
IT IS FURTHER ORDERED that parties should continue to comply with Order No.
34602, issued March 17, 2020. All pleadings should be filed with the Commission electronically
and shall be deemed timely filed when received by the Commission Secretary. See Rule 14.02.

NOTICE OF PROPOSED SETTLEMENT
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34714 6

Service between parties should also be accomplished electronically. Voluminous discovery-related
documents may be filed and served on CD-ROM or a USB flash drive.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 30th
day of June 2020.

PAUL KJELLANDER, PRESIDENT

KRISTINE RAPER, COMMISSIONER

ERIC ANDERSON, COMMISSIONER

ATTEST:

Diane M. Hanian
Commission Secretary

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