20211020Final_Order_No_35204.pdf

ORDER NO. 35204 1

Office of the Secretary
Service Date
October 20, 2021
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF ROCKY MOUNTAIN
POWER’S APPLICATION FOR APPROVAL
OF THE ASSET TRANSFER AGREEMENT
BETWEEN ROCKY MOUNTAIN POWER
AND THE CITY OF IDAHO FALLS – 733
CUSTOMERS
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CASE NO. PAC-E-21-17

ORDER NO. 35204

On July 20, 2021, Rocky Mountain Power (“Company”), a division of PacifiCorp,
asked the Commission to approve its Reimbursement and Asset Transfer Agreement (“Asset
Transfer Agreement”) with the City of Idaho Falls (“City”). Under the Asset Transfer Agreement,
the City would buy Company-owned electric facilities the City needs to provide electric service to
733 customers in Idaho Falls (“Customers” or “733 customers in Idaho Falls”). The Company
submitted its Application under the Electric Supplier Stabilization Act (“ESSA”), Idaho Code §
61-332, et seq., and the electric utility transfer statute, Idaho Code § 61-328. The latter statute
states that the Commission “shall issue a public notice and shall conduct a public hearing upon
the application.” See Idaho Code § 61-328(2) (emphasis added).
On August 19, 2021, the Commission issued a Notice of Application, Notice of
Modified Procedure, and Notice of Telephonic Hearing. See Order No. 35142. The Commission
held a telephonic hearing on September 22, 2021. No members of the public testified. The
Commission Staff (“Staff”) filed comments supporting the Application. No other comments were
received. The Company did not file a reply.
Based on our review of the record, the Commission now issues this final Order
approving the Company’s Application as noted below.
BACKGROUND
Public utilities are statutorily prohibited from transferring any property “used in the
generation, transmission, distribution, or supply of electric power” without first being authorized
to do so by the Commission. See Idaho Code § 61-328(1). Before the Commission can approve
such a transaction, it must first find: (a) the transaction is consistent with the public interest; (b)
the cost of and rates for supplying service will not be increased by reason of such transaction; and
(c) that the applicant for such acquisition or transfer has the bona fide intent and financial ability
to operate and maintain said property in the public service. See Idaho Code § 61-328(3)(a-c).

ORDER NO. 35204 2

The purpose of the ESSA is to: (1) promote harmony between electric suppliers; (2)
prohibit the “pirating” of customers; (3) discourage duplication of electric facilities; (4) actively
supervise the conduct of electric suppliers; and (5) stabilize service territories and customers. See
Idaho Code § 61-332(2). The ESSA prohibits an electric supplier (e.g., utility, municipality, or
cooperative) from serving another electric supplier’s current or former customers. See Idaho Code
§ 61-332(B). However, an exception to the general rule exists within the ESSA framework
allowing electric suppliers to contract for “allocating territories, consumers, and future consumers
. . . and designating which territories and consumers are to be served by which contracting electric
supplier.” See Idaho Code § 61-333(1). Allocation agreements must be submitted to the
Commission for approval and will be approved only upon a finding that they conform to the
provisions and purposes of the ESSA. Id.
THE APPLICATION
The Company and the City signed a Service Allocation Agreement in 2017 to reduce
duplication of service and promote stability in their respective service areas. The Commission
approved the Service Allocation Agreement in Case No. PAC-E-17-12. See Order No. 33943.
Under the Asset Transfer Agreement, the City will buy electric facilities from the
Company to serve former customers of the Company, 733 customers in Idaho Falls. The City will
also compensate the Company for the lost revenues arising from the customers’ departure. The
Service Allocation Agreement defines compensation as “just compensation for the facilities” and
in addition “an amount equal to one hundred sixty seven percent (167%) of the Existing
Consumer’s revenue collected from the most recent twelve (12) months of active provision of
electric service[.]” See 2017 Service Allocation Agreement at p. 2 - 3, ¶ 6, Case No. PAC-E-17-
12. The total sale price for the transaction is $4,152,351.
THE COMMENTS
Staff filed the only comments and recommended that the Commission approve the
Company’s Application. Staff determined that the Application complied with the ESSA, the Idaho
electric utility asset transfer statute, and previous Commission orders. Staff also determined that
the funds from the transfer represent the fair market value of the assets being transferred and
calculations were made using the appropriate method agreed to in the Service Allocation
Agreement. Staff stated the transaction would not harm customers.

ORDER NO. 35204 3

COMMISSION FINDINGS AND DISCUSSION
The Commission has jurisdiction over this matter under Idaho Code §§ 61-328 and 61-
333. The Commission has reviewed the record, including the Asset Transfer Agreement and
comments of Staff. We find the Asset Transfer Agreement satisfies the ESSA, Idaho Code § 61-
332 et. seq., the electric utility transfer statute, Idaho Code § 61-328, the 2017 Service Allocation
Agreement, and this Commission’s prior orders. Accordingly, we find it reasonable to approve the
Application and the Asset Transfer Agreement.
O R D E R
IT IS HEREBY ORDERED that the Company’s Application is approved. The sale of
electric facilities and transfer of service territory as contemplated in the Company’s Asset Transfer
Agreement with the City is approved.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within 21-days of the service date of this Order with regard to any matter decided
in this Order. Within seven (7) days after any person has petitioned for reconsideration, any other
person may cross-petition for reconsideration. See Idaho Code § 61-626.
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ORDER NO. 35204 4

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 20th day
of October 2021.

PAUL KJELLANDER, PRESIDENT

KRISTINE RAPER, COMMISSIONER

ERIC ANDERSON, COMMISSIONER

ATTEST:

Jan Noriyuki
Commission Secretary

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