HomeMy WebLinkAbout20150313Comments.pdfil
March 13,2015
Jean D. Jewell, Secretary
Idaho Public Utilities Commission
PO Box 83720
Boise, ldaho 83720-007 4
Re: IPUC Case No. PAC-E-15-01
Dear Ms. Jewell:
j?nCr:1i,,';,
RANDALL C. BUDGE
?gl5 HAR l3 Pll 3: l2 rcb@racinelaw.net
liirii, i.-- i
UT lLl'li I: : Cl,,l, il i.iSt r_;i,
Hand Delivered
RACINE
OLSON
NYE
BUDGE
BAILEY
2Ol E. Center St.
P.O. Box 1391
Pocatello, lD 83204
oFFtcE 208.232.6101
FAX 208.232.6109
raclnelaw.net
Enclosed you willfind the original and seven (7) copies of Comments of
Monsanto Company. Please file the same with the Commission's records. lf you
have any questions, please don't hesitiate to call.
Thank you.
Sincerely,
Wc.g^k
RANDALL C. BUDGE
RCB:tscc: Service List
Randall C. Budge,ISB No. 1949
Thomas J. Budge, ISB No. 7465
RACINE, OLSON, NYE, BUDGE &
BAILEY, CHARTERED
P.O. Box l39l1,201E. Center
Pocatello, Idaho 83204-1391
Telephone: (208) 232-6101
Fax (208) 232-6109
rcb@racinelaw.net
Attorneys for Intervenor Monsanto Company
IN THE MATTER OF THE APPLICATION
OF ROCKY MOUNTAIN POWER FOR
AUTHORITY TO INCREASE RATES BY
$10.7 MILLION TO RECOYER
DEF'ERRED I\-ET POWER COSTS
THROUGH THE ENERGY COST
ADJUSTMENT MECHAMSM
Pr{t?
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
) CASE NO. PAC-E-15-0I
)) APPLTCATTON OF ROCKY
) MOUNTAIN POWER
)
)
)
COMMENTS OF MONSANTO COMPAI\TY
INTRODUCTION
COMES NOW Intervenor Monsanto Company ("Monsanto") through counsel and submits
these Comments with respect to the February 2, 2015 Application of PacifiCorp, dlbla Rocky
Mountain Power ("Company") seeking authorization to increase rates by $10.7 million to recover
deferred net power costs through the Energy Cost Adjustment Mechanism (ECAM). Monsanto's
Comments are in response to the Commissionos Order No. 33235 dated February 25,2015, giving
notice of the Application, and that this matter will proceed under Modified Procedure, authorizing
interested persons to file written comments in support or opposition, and providing rights or
participation by filing a Petition to Intervene. Monsanto's Petition to Intervene was granted
February 25,2015 by OrderNo.33232.
COMMENTS OF MONSANTO COMPANY. I
MONSAIITO COMMENTS
Monsanto has reviewed the testimony and exhibits in this case and requests the
Commission and Company consider an alternative strucfure for the payment of Monsanto's prior
deferral balance of $6,175,247 . The Company proposes to recover this amount as a
0.441 cents/kWh charge over the next twelve months. The Company further proposes that
Monsanto pay the 2014Deferralrate of 0.467 cents/kWh, for a combined total rate of
0.908 cents/kWh. [n order to split apart the prior deferal revenues from the 2014 Defenal
revenues, the Company proposes to apply 54.0 percent of the 0.908 cents/kWh against the
balance of the prior deferrals, and 46.0 percent against the 2014 Deferral balance. We have two
primary concerns with this treatment: (1) ensuring that Monsanto neither over-pays or under-
pays its actual prior defenal balance, and (2) ensuring that Monsanto does not pay the portion of
the 2014 Deferral related to the under-collection from the standard tariff customers.
Monsanto Should Pav Its Prior Deferral Balance
The Company has estimated that Monsanto's prior deferral balance is$6,175,247 based
on forecasted information for the months of January, February and March 2015. Since the
Company filed its Application on February 2,2015, updated billing information has become
available. Using actual ECAM revenues for January, February and March 2015, the deferral
balance is actually $6,106,392, as shown on Attachment A to these Comments.l We recommend
the Commission use this updated figure for purposes of establishing Monsanto's payment of its
prior deferral balance.
Second, Monsanto is concerned that the Company neither over-collect or under-collect
the prior deferral balance. As this is the final year for Monsanto to pay down its individual prior
deferal balance, it would be best if the amount were paid off as accurately as possible.
Recovering Monsanto's prior deferral balance on a cents/kWh basis as the Company proposes
may either over-collect or under-collect depending on Monsanto's loads and depending on the
proportionate tracking of the collections. For example, the Company proposes to track the
rDue to the lag in ECAM revenues, the actual revenues for these three months are from the December 2014, January
2015 and February 2015 invoices.
COMMENTS OF MONSANTO COMPAI\TY - 2
recovery of the prior deferral balance by proportioning Monsanto's monthly collections as 46.0
percent applied against the balance for the 2014 Defemal, and 54.0 percent applied against the
prior deferral balance. We estimate that applying 54.0 percent of the proposed collections from
Monsanto against the balance of the prior deferral could result in an over-collection by as much
as $678,000 above the $6,175,247 estimated balance.2 Furthermore, Monsanto questions
whether the 54.0 percent allocator is the proper percentage to apply. As explained in the
testimony of Ms. Joelle Steward, the 54.0 percent is premised on the assumption that 10.5
percent, or $1.7 million, of the 20L4Defenal is related to the outstanding balance from standard
tariff customers. A closer inspection of the work papers, however, reveals that of the
$16,703,740 to be recovered for the 2014 Deferral, the outstanding balance from standard tariff
customers appears to be $69,178 after the forecasted Schedule 94 collections for December 2014
through March 2015 are included.3 Hence, the 54.0 percent allocator may over-recover
Monsanto's prior deferral balance, and simultaneously under-recover the 2014 Deferral shared
by all customers.
Consequently, Monsanto suggests that a simpler approach would be for Monsanto to
make equal monthly payments in order to pay down its $6,106,392 balance to $0, as well as pay
the monthly interest. A monthly payment of $511,413.50 will pay back the prior deferral
balance at the annual interest rate of lo/o. Attachment B to these comments provides the details
of this pay-off for the months April20l5 through March 2016.
Monsanto Should Not Pav for the Standard Tariff Under-Collection
The Company is rightfully concerned that TariffContract 400 and 401 customers not pay
for the portion of the 2014Defenal related to the under-collection from the standard tariff
customers from the prior year. To accomplish this, the Company proposes to correspondingly
reduce the percentage of collections allocated to the 2014 Deferral for Tariff Contract 400 and
401, and increase the percentage of collections allocated to the prior deferral balance. However,
the Company has not provided any explanation of how that percentage reduction will result in
2 Assuming Monsanto loads are the same as last year's loads.
3 See the Excel file entitled *ID 2015 ECAM Rate Design Workpaper", sheet 'NPC - Exhibit 1", cellU74.
COMMENTS OF MONSANTO COMPANY - 3
any lower cost to TariffContract customers since the proposed rate of 0.467 cents/kWh includes
recovery of the standard tariff under-collection. Monsanto is still concerned that despite the
Company's good intentions, the details of this proposal have not yet been adequately resolved.
Monsanto suggests two possible resolutions to this situation. The first alternative would
be to design the ECAM rate for Tariff Contract customers without the standard tariff under-
collection, and likewise design the ECAM rate for standard tariff customers with the standard
tariff under-collection. As shown in Attachment B, Monsanto's ECAM rate would be 0.465
cents/kWh (as opposed to the proposed 0.467 cents/kWh). This would place the cost ofthe
standard tariff under-collection back onto the appropriate customers.
A second alternative solution would be to have Monsanto pay the 0.468 cents/kWh
Schedule 94 ECAM rate,a and provide a monthly credit to Monsanto for its share of the $69,178
standard tariff customers' under-collections. As shown on Attachment B, we calculate
Monsanto's share of the under-collection from the standard tariff customers to be $42,000, or a
monthly credit of $3,500. Consequently, Monsanto would pay a net fixed monthly amount of
$507,913 to pay off its prior deferral balance, while paying the same ECAM rate as all
transmission customers, that is, 0.468 centsikWh over the next twelve months. Monsanto would
be open to discussing these alternative solutions with the Company and Commission Staff.
RESPECTFULLY SUBMITTED this 13ft day of March,20l5.
RACINE, OLSON, NYE, BUDGE &
BAILEY, CHARTERED
a The 0.468 cents/kWh ECAM rate is based on the fact that only standard tariffcustomers are allocated the $69,178
under-collection. See Attachment B.
COMMENTS OF MONSANTO COMPANY- 4
CERTIFICATT, OF MAILING
I IIEREBY CERTIFY that on this 134 Oay of March ,2Ol5,I served a true, correct
and complete copy of the foregoing document, to each of the following, via the method so
indicated:
Jean D. Jewell, Secretary (original and7)
Idaho Public Utilities Commission
P.O. Box 83720
Boise,lD 83720-0074
E-mail : jjewell@puc.state.id.us U.S. Mail
Ted Weston
Idaho Regulatory Affairs Manager
Rocky Mountain Power
201 South Main, Suite 2300
Salt Lake City, Utah 8411I
E-mail: ted.weston@fracificorp.com E-Mail
Yvonne R. Hogle
Senior Counsel
Rocky Mountain Power
201 South Main, Suite 2300
Salt Lake city, utah 84111 E-Mail
E-mail: Yvonne.hogel@pacificorp.com
Ronald L. Williams
Williams Bradbury, P.C.
1015 W. Hays St.
Boise 1D,83702
Telephone :208 -3 44 -663 3
Fax:208-3 44-0077 E-Mail
ron@wil I iamsbradbury.com
COMMENTS OF MONSANTO COMPAJ{Y. 5
ATTACHMENT A
Monsanto Prior Deferral Balance as of April 1. 2015 Based on Actuals
AS FILED BY RMP IN ITS APPLICATIONLine
No.
1
2
3
4
5
6
7
8
I
lnterest Rate
Monsanto Balance
Less: Monthly Payment
lnterest
Ending Balance
Monsanto Balance
Less: Monthly Paynent
lnterest
Ending Balance
Order Nos. 32403,32684
Exhibit No. 3
Forecast
Exhibit No. 3
Actual
Dec-14
1.00o/o
7,949,050
(344,930)
6,480
7,610,601
Feb-'15 Mar.15
1.00%1.00Yo
7,949,050 7,610,601 7,097,996 6,590,101(344,930) (518,731) (513,596) (420,17',t)6,480 6,126 5,701 5,317
7,610,601 7,097,996 6,590,101 6,',t75,247
Jan-15
1.00o/o
7,6't0,601 7,096,109 6,604,193(520,617) (497,622) (503,095)6,'125 5,706 5,294
7,096,109 6,604,193 6,106,392
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