151223_RMPfinal.pdf

Case No. PAC-E-15-09, Order No. 33440
Contact: Gene Fadness [phone]
www.puc.idaho.gov

PUC adopts settlement to Rocky Mountain case

BOISE (Dec. 23, 2015) – The Idaho Public Utilities Commission is adopting a settlement to
various issues surrounding Rocky Mountain Power Company’s request to transfer some of its
variable power supply expense into permanent base rates.

The settlement increases base rates about 3.9% in 2016 (2.8% for residential customers), but
customers will notice a reduction of near the same size when the company files its annual
Energy Cost Adjustment Mechanism (ECAM) to be effective in 2017. A residential customer who
uses the average 801 kilowatt-hours per month would pay about $2.35 more each month.

The settlement replaces a base rate case that Rocky Mountain Power would have filed this
year. It also includes a “stay-out” provision that prevents another base rate increase until Jan 1,
2018 at the earliest. Rocky Mountain serves about 75,000 customers in eastern Idaho.

There are two primary components of customer rates. The base rate covers fixed costs that
rarely change from year to year, while the ECAM includes expenses that vary each year
depending on weather, fuel costs and wholesale market prices. If variable expense is less than
that already included in rates, customers receive a credit. If variable expenses are greater than
that already included in rates, customers are assessed a one-year surcharge.

The settlement shifts $10.2 million of expense currently collected through the ECAM into base
rates. Customers will be credited about that same amount when the company files its ECAM in
2017. Commission staff estimated that the combined net impact of the base rate increase in
2016 and the projected ECAM decrease in 2017 will be about $889,000 per year or 0.34% more
than what customers would have paid through current base rates and the current ECAM.

About $6.5 million of the $10.2 million shift is expense related to revenue the company no
longer receives from the trading of Renewable Energy Certificates (RECs). Another $3.2 million
is power supply expense for generation fuel and buying/selling power. The settlement also
changes the way the yearly ECAM is calculated, measuring it on a dollar-per-megawatt hour
basis using load at the meter rather than load at the generator.

The commission said the settlement represents a “reasonable compromise” of various positions
raised by the parties, which included the company, commission staff, the PacifiCorp Idaho
Industrial Customers and Monsanto Company.

“The hallmark of reasonable compromise is a mutually beneficial resolution for both sides of a
transaction,” the commission said. “Accordingly, the commission finds that the stipulation
offers substantive benefits to both ratepayers and company.”

The Snake River Alliance, while not a party to the case, submitted written comments in support
of the settlement.

Petitions for reconsideration must be submitted by no later than Jan. 13. Petitions must cite
why the order is unreasonable, unlawful or erroneous. Petitions should include a statement of
the nature and quantity of evidence the petitioner will offer if reconsideration is granted.

Petitions can be delivered to the commission at 472 W. Washington St. in Boise, mailed to P.O.
Box 83720, Boise, ID, 83720-0074, or faxed to 208-334-3762.

The commission’s final order and other documents are available on the commission’s website
at www.puc.idaho.gov. Click on Open Cases under the “Electric” heading and scroll down to
Case No. PAC-E-15-09.

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