20190403Meredith Direct.pdf

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BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF ROCKY MOUNTAIN POWER
REQUESTTNG APPROVAL OF $ls
MILLON NET POWER COST DEFERRAL
) CASE NO. PAC-E-19-04
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) DIRECT TESTIMONY OF
) ROBERT M. MEREDITH
o ROCKY MOUNTAIN POWER
CASE NO. PAC-E-19-04
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April2019
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Please state your name, business address and present position with PacifiCorp,
dba Rocky Mountain Power ("the Company").
My name is Robert M. Meredith. My business address is 825 NE Multnomah Street,
Suite 2000, Portland, Oregon 97232. My present position is Manager, Pricing and Cost
of Service.
Qualifications
Briefly describe your educational and professional background.
I graduated from Oregon State University in 2004 with a Bachelor of Science degree
in Business Administration and a minor in Economics. In addition to my formal
education, I have attended various industry-related seminars. I have worked for the
Company for 14 years in various roles of increasing responsibility in the Customer
Service, Regulation, and Integrated Resource Planning departments. I have over eight
years of experience preparing cost of service and pricing related analyses for all of the
six states that PacifiCorp serves. I assumed my present position in March 2016.
Have you testified in previous regulatory proceedings?
Yes. I have previously filed testimony on behalf of the Company in regulatory
proceedings in Idaho, Utah, Wyoming, Oregon, Washinglon and California.
What is the purpose of your testimony in this proceeding?
My testimony presents and supports the Company's proposed rates to recover the 2018
Energy Cost Adjustment Mechanism ("ECAM") deferral balances through Electric
Service Schedule No. 94, Energy Cost Adjustment ("Schedule 94").
R Meredith, DT-l
PacifiCorp
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t I Background
2 Q. What level of revenues is Schedule 94 currently designed to collect?
3 A. Schedule 94 is currently designed to collect approximately $9.3 million-$3.7 million
4 for Tariff Contract 400, $0.3 million for Tariff Contract 40 I , and $5.3 million for the
5 standard tariff customers-based on Idaho loads from Case No. PAC-E-I5-09.
6 Proposed Rate Change for Schedule 94
7 Q. Please describe the Company's proposed rate change in this case.
8 A. The 2019 ECAM application proposes to increase Schedule 94 rates to recover
9 approximately $13.9 million from June 1,2019 to May 31,2020. The $13.9 million
l0 includes $15.1 million for the 2018 ECAM Deferral, plus approximately $2.2 million
1l remaining from the 2017 ECAM balance, for a total balance of $17.3 million as of
12 December 31, 2018. This is offset by a net credit of $86,905 in the depreciation
13 regulatory asset balance and $3.3 million Schedule 94 forecasted revenue collection
14 from January 1,2019 through May 31, 2019, as shown in Table 2 of Mr. Michael G.
15 Wilding's testimony. Mr. Wilding explains in his testimony the components of the
16 2018 ECAM deferred balance. The $13.9 million balance summarized in Table 2 is
17 also partially offset by a $3.344 million ($0.957 per megawatt-hour credit) amortization
l8 of the amount representing the savings from federal tax reform resulting from the Tax
19 Cuts and Jobs Act, enacted in December 2017, as prescribed in the tax settlement
20 stipulation among the Company and parties filed with the Commission March 5,2019
2l in Case No. GNR-U-I8-01 ("ECAM Tax Reform Credit").
22 a. Please explain the proposed rate change for Tariff Contracts 400 and 401.
23 A. The proposed rate for Tariff Contracts 400 and 401 is the same as for standard tariff
R Meredith,DT-z
PacifiCorp
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o I customers with transmission delivery service voltage.
2 Q. What is the impact of the proposed ECAM rates?
3 A. As summarized in my Exhibit No. 2, these rate change proposals result in an increase
4 of 0.5 percent for Tariff Contract 400, and an increase of 0.5 percent for Tariff Contract
5 401. Standard tariff customers will also see an average increase of 0.4 percent, or $0.8
6 million. However, if the tax reform settlement in Case No. GNR-U-I8-01 is approved
7 by the Commission, Schedule 197 - Federal Tax Act Adjustment credit will be
8 increased by $1.a million effective June 1,2019. The net impact of the changes to
9 Schedule 94 and 197 is an overall rate decrease of approximately $131,000 for ldaho
l0 customers.
I I Calculation of Proposed Rates for Schedule 94
12 a. How were the proposed Schedule 94 rates developed for all customers?
13 A. The proposed rates for all customers were developed in four steps. First, I developed
14 their kilowatt-hour ("kwh") consumption at the generation level by multiplying their
l5 retail loads at the delivery service voltage level with the corresponding line loss factors.
16 Next, an overall average rate at the generation level was developed by dividing their
17 total collection target identified above with their kWh consumption at the generation
18 level. Third, rates by delivery voltage level were developed by multiplying the above
19 overall average rate at the generation level with the corresponding line loss factors.
20 Finally, the proposed rates were calculated by adding the 0.0957 cents per kwh ECAM
2l Tax Reform Credit to the prices by delivery voltage level. As a result, the Company
22 proposes Schedule 94 rates of 0.316, 0.302 and 0.292 cents per kWh for secondary,
23 primary and transmission delivery service voltages, respectively, for all customers.
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R Meredith, DT-3
PacifiCorp
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Please describe Exhibit No. 2.
Exhibit No. 2 shows the 2014 loads used to develop rates, the line loss adjusted loads,
the allocation of the ECAM price change including the ECAM Tax Reform Credit, and
the percentage change by rate schedule.
Please describe Exhibit No. 3.
Exhibit No. 3 contains clean and legislative copies of the proposed Electric Service
Schedule No. 94, Energy Cost Adjustment. The Company requests that the proposed
Schedule 94 rates become effective on June 1,2019.
Does this conclude your direct testimony?
Yes.
R Meredith,DT-4
PacifiCorp
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