20190412Decision Memo.pdf

DECISTON MEMORANDUM
TO COMMISSIONER KJELLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:MATT HUNTER
DEPUTY ATTORNEY GENERAL
DATE: APRIL ll,20l9
SUBJECT: ROCKY MOUNTAIN POWER'S ECAM APPLICATION
CASE NO. PAC.E.I9.O4
On March 29,2019, PacifiCorp dba Rocky Mountain Power applied to the Commission
for an Order authorizing the Company to adjust its rates under the Energy Cost Adjustment
Mechanism (ECAM). If approved, the Company's ECAM adjustment would collect an additional
$4.6 million from the Company's Idaho customers from June 1,2019 to May 31,2020. However,
this increase would be offset by a number of expected savings during the same period, resulting in
a net rate decrease of approximately $ 13 1,000 for Idaho customers.
The Commission approved the ECAM in2009, and the mechanism has been modified
severaltimes since then. See OrderNos. 30904,32432,32910,33008, 33440,33492,and33776.
In summary, the ECAM allows the Company to increase or decrease its rates each year to reflect
changes in the Company's power supply costs. These costs vary by year with changes in the
Company's fuel (gas and coal) costs, surplus power sales, power purchases, and associated
transmission. The ECAM adjusts the Company's rates up or down to ensure the rates capture the
difference between the Company's actual power supply costs and the base (or embedded) power
supply costs the Company collected from customers through previously approved base rates.
With this Application, the Company seeks an Order approving the Company's: (1)
deferral, for later recovery through rates, of $15.1 million in power supply costs from January 1,
2018 through December 31,2018; and (2) revised Electric Service Schedule 94, Energy Cost
Adjustment, which would reflect the ECAM adjustment and increase the Company's Schedule 94
DECISION MEMORANDUM 1
revenues by $4.6 million. The Company states that if its proposal is approved, prices for customer
classes would increase as follows:
a
Residential Customers - 0.3%
Residential Schedule 36, Optional Time-of-Day Service - 0.4 o/o
General Service Schedule 6 - 0.5%
General Service Schedule 9 - 0.5%
Irrigation Customers - 0.4%
Commercial or Industrial Heating Schedule 19 - 0.5%
General Service Schedule 23 - 0.4%
General Service Schedule 35 - 0.6%
Public Street Lighting -0.2%
Industrial Customer, Schedule 400 -0.5%
Industrial Customer, Schedule 401 - 05%
Source: Application, Exhibit No. 2 to Direct Testimony of Robert M. Meredith; See also,
News Release and Customer Notice filed with Application.
These increases will be offset by a number of savings during the same period. Most
significantly, the Company received federal tax cuts because of the Tax Cuts and Jobs Act, and
will pass on the savings to customers as a $0.957 per megawatt-hour credit. As a result, Idaho
customers will receive a net rate decrease of approximately $ 131,000. The Company requests that
the new rates take effect on June 1,2019, and that the case be processed by Modified Procedure.
STAFF RE,COMMENDATION
Staff concurs with the use of Modified Procedure. Staff recommends that the
Commission issue a Notice of Application and Notice of Modified Procedure setting aMay 14,
2019 comment deadline, and a May 21,2019 reply deadline.
COMMISSION DECISION
Does the Commission wish to issue a Notice of Application and Notice of Modified
Procedure setting a May 14,2019 comment deadline, and a May 21,2019 reply deadline?
L
Matt Hunter
Deputy Attorney General
l:\Legal\ELECTRIC\PAC-E-19-04\memos\PACEl904 mh docx
DECISION MEMORANDUM 2