140303_IPCSched19.pdf

Idaho Public Utilities Commission
Case No. IPC-E-14-01, Order No. 32982
March 3, 2014
Contact: Gene Fadness [phone]
Website: www.puc.idaho.gov

Commission adopts tariff revisions
to accommodate industrial expansions
Large industrial customers of Idaho Power Company who must pay for new substation or
transmission facilities to serve their increased electric load may receive upfront credits for each
year up to five years to help them meet the expense of the expanded facilities.
The Idaho Public Utilities Commission has approved a revision to Idaho Power’s tariff for
industrial customers that will make it more affordable for industrial customers requiring Idaho
Power to upgrade transmission or substation facilities needed to serve one customer.
Builders of residential and commercial developments already receive an allowance under the
“Rule H tariff” to help pay for distribution-related line extensions. The cost of new or expanded
facilities is typically shared between the new customer and the utility, lowering the cost barrier
customers face when seeking new or additional line extensions. The allowance makes it
possible for the amount of upfront charges to be paid by the customer to be reduced by
permitting the utility to collect a portion of the expense over time.
When Glanbia Foods, Inc., a Gooding cheese plant, applied for a Rule H allowance last year,
Idaho Power claimed the allowance applied to only distribution voltage equipment, not new
substations or high-voltage transmission lines. Glanbia is funding $8.3 million in Idaho Power
facility improvements ($4.5 million for a 10-mile transmission line and $3.8 million for a
substation) and increasing its annual power bill to Idaho Power by about $7 million.
Glanbia requested an allowance of $2.3 million and also asked for entitlement to future
potential “vested interest” payments. Vested interest payments are provided the party that
paid for the initial expansion as new customers who are using the same facilities are later
added. In the Glanbia case (IPC-E-13-09), the commission eventually approved an allowance of
$1.25 million using a formula allowing it $65,734 per megawatt of the plant’s projected load of
19 MW. The commission also allowed vested interest payments to be directed to Glanbia if new
customers connect to the Glanbia property substation facilities within the next five years.
As a result of the Glanbia case, the commission directed Idaho Power to propose a substation
and transmission allowance and vested interest provision for large industrial customers.
In this case, the commission adopted Idaho Power’s proposed allowance of up to $65,480 per
MW multiplied by the customer’s projected increase in load for each year up to five years. If the
load used by the new customer decreases, it would receive less of an allowance. The tariff
revision is effective immediately.
A full text of the commission’s order, along with other documents related to this case, is
available on the commission’s Web site at www.puc.idaho.gov. Click on “Open Cases” under
the “Electric” heading and scroll down to Case No. IPC-E-14-01.

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