20020510Comments of Monsanto.pdf

Randall C. Budge, ISB 1949
RACINE, OLSON, NYE, BUDGE &
BAILEY C~ TERED
O. Box 1391; 201 E. Center Street
Pocatello, Idaho 83204-1391
Telephone: [phone]
Fax: [phone]
Attorneys for Intervenor Monsanto Company
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BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
In the Matter of the Application of
ACIFICORP dba Utah Power & Light
Company for Approval of Changes to its
Electric Service Schedules
CASE NO. PAC-02-
COMMENTS OF MONSANTO COMPANY
COMES NOW Intervenor Monsanto Company ("Monsanto ), by and through their counsel
of record, and hereby submits these comments to the Commission in support of the Stipulation
entered into between PacifiCorp, Staff and the Idaho Irrigation Pumpers Association and submitted
to the Commission for approval for the purposes of settling this case. At the conclusion of the
technical hearing on May 7 2002, the Commission established a written comment deadline of May
2002.
As a signatory party to the Stipulation, Monsanto agreed that the Stipulation represents a fair
just and reasonable compromise of the issues raised in this proceeding, and is in the public interest.
Monsanto therefore recommends approval of the Stipulation and all of its terms and conditions.
As a Special Contract customer, Monsanto s rates are unaffected by this case, whether
concluded by the Commission s approval of the Stipulation or a subsequent Order following hearing.
Regardless, Monsanto was compelled to fully participate because of cost of service issues presented
by PacifiCorp. Cost of service issues for Monsanto as well as all other customer classes will likely
be addressed in the Monsanto-specific rate case, No. PAC-Ol-16. The Stipulation m~kes it
unnecessary for Monsanto and other parties to participate in back-to-back contested cases f!. t.,...-'
disputes over PacifiCorp s cost-of-service studies.
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COMMENTS OF MONSANTO COMPANY - 1
As a Special Contract customer ofPacifiCorp for over 50 years, Monsanto has been treated
as a system customer rather than a situs customer for revenue and cost allocation purposes. This was
recognized because of the size and interruptible nature of the Monsanto load which provides the
system with substantial load balancing and operating reserves benefits. Monsanto is not subject to
increases resulting from general rate cases and surcharges. On the other hand, Monsanto does not
receive firm power, nor the decreases benefitting tariff rate customers which resulted from the 1988
Utah Power-PacifiCorp merger, nor the merger credits arising out of the 1999 Scottish Power-
PacifiCorp merger. It is noteworthy that while most tariff rate customers will end up with a double
digit decrease and none with a greater than 4% increase based on the Stipulation, PacifiCorp
proposal to Monsanto in Case No. PAC-01-16 is to eliminate Monsanto as a special contract
customer, treat Monsanto as a firm tariff rate Idaho customer and raise Monsanto s rates by 70%.
At the prehearing conference and during the course of the ensuing negotiations between the
parties, Monsanto raised certain issues and defenses which it intended to pursue at hearing. 1
asserting that:
Recovery of excess power supply costs is barred by reason of the Scottish Power-
PacifiCorp Merger Approval Condition No.
Power supply costs associated with the Hunter Plant failure are not recoverable
because they were incurred subsequent to the Deferral Order;
Any Hunter-related costs properly deferred should be equitably shared with
stockholders because PacifiCorp has been unable to determine the cause of the
failure, there is evidence of maintenance problems and the unit was their
responsibility to maintain and care for;
Costs associated with certain wholesale contracts were imprudently incurred and not
recoverable;
Thorough review and approval of the Company s cost -of-service studies was required
before rates should be shifted among the customer classes. The intent of paragraph
14 of the Stipulation is to ensure that the negotiations and resulting Stipulation in this
Monsanto s defenses as well as those asserted by lIP A are set forth in paragraph 5 of the
Stipulatio
COMMENTS OF MONSANTO COMPANY - 2
would be afforded an opportunity to object. Monsanto has since received and had an opportunity
to review Exhibit 22 and has no objection. Notwithstanding, it must be noted that Monsanto does
not in any way agree with the substance of Exhibit 22. Monsanto believes that the response is
inaccurate, misleading and a mere attemptto justify PacifiCorp s failure to respond to an opportunity
to further curtail Monsanto s load and mitigate high market purchases. While Monsanto could
address the letter in detail, such is unnecessary at this time and inappropriate given Monsanto
approval and support of the Stipulation.
RESPECTFULL Y SUBMITTED this 9th day of May, 2002.
RACINE, OLSON, NYE, BUDGE &
BAILEY, CHARTERED
~ ~.
RANDALL C. BUDGE
CERTIFICATE OF SERVICE
I hereby certify that on this 9th day of May, 2002, a true and correct copy of the foregoing
was served on the following via U.S. mail:
Scott Woodbury
Deputy Attorney General
Idaho Public Utilities Commission
O. Box 83720
Boise, ID 83720-0074
Eric Olson
Racine , Olson, Nye, Budge & Bailey
O. Box 1391
201 E. Center
Pocatello, ID 83204-1391
Anthony J. Yanke1
29814 Lake Road
Bay Village , OR 44140
COMMENTS OF MONSANTO COMPANY - 4
Randall C. Budge
Racine, Olson, Nye, Budge & Bailey
O. Box 1391
201 E. Center
Pocatello , ID 83204-1391
James R. Smith
Senior Accounting Specialist
Monsanto Company
O. Box 816
Soda Springs, ID 83276
Mr. Tim Shurtz
411 South Main
Firth, Idaho 83236
Doug Larson
Vice President Regulation
Pacificorp
201 S. Main, Suite 2300
Salt Lake City, UT 84140
James F. Fell
Erinn Kelley-Sie1
John M. Eriksson
Stoel Rives LLP
201 S. Main Street, Suite 1100
Salt Lake City, UT 84110
Conley Ward
Givens , Pursley
O. Box 2720
Boise, Idaho 83701
RANDALL C. BUDGE
COMMENTS OF MONSANTO COMPANY - 5