20020205Order No. 28949.pdf

NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 28949 -1-
Office of the Secretary
Service Date
February 5, 2002
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION OF
AVISTA UTILITIES FOR APPROVAL TO
CHANGE ITS NATURAL GAS TARIFFS TO
INCLUDE DEFERRED GAS COST
ASSESSMENTS.
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CASE NO. AVU-G-02-1

NOTICE OF APPLICATION

NOTICE OF MODIFIED
PROCEDURE

ORDER NO. 28949

NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED that Avista Utilities (Avista) filed a Petition on January
17, 2002 for Commission approval to change its natural gas tariffs to include deferred gas cost
assessments. Avista provides natural gas service to approximately 55,000 customers in northern
Idaho.
YOU ARE FURTHER NOTIFIED that Avista asserts that existing rates and annual
Company revenues will not change if their Petition is approved as filed. Petition at 1.
YOU ARE FURTHER NOTIFIED that Avista’s Petition explains that with the recent
decline in market natural gas services, there is currently a significant cost/price incentive for qualifying
sales customers to change to transportation service. Id. at 2. To switch between sales and
transportation service, customers must have a minimum annual usage of 250,000 therms and provide
90 days prior notice. Two Idaho customers have recently provided notice to change to transportation
service and six additional sales customers could potentially make the same change. Id.
YOU ARE FUTHER NOTIFIED that Avista’s present gas sales rates include an
amortization charge of 11.8 cents per therm, which was approved by Commission Order No. 28827 in
the Company’s last Purchased Gas Adjustment (PGA) filing. The amortization rate was designed to
recover the balance of deferred gas costs over a 2.5-year period. Avista estimates approximately $1
million in deferred gas costs would be collected from these eight customers during this period. Id. If
these qualifying sales customers are allowed to switch to transportation without paying their share of
these deferred costs, Avista represents that the rates of the remaining sales customers could be

NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 28949 -2-
significantly impacted. Id.
YOU ARE FURTHER NOTIFIED that if approved as filed, the proposed Tariff
Schedule 146B changes would allow deferred gas costs to be assessed to natural gas customers that
switch from a sales service schedule to transportation service. Id. Avista proposes to calculate these
deferred gas costs by multiplying the difference between what they paid for gas (included in tariff
rates) and the Company’s actual gas costs by their actual usage for each month of the deferral period.
Id. The deferral period begins with the month of July 1999, which is the first month of the deferral
period from the Company’s last PGA filing, and ends with the most current month. The Petition
states that this calculation would capture the customer’s share of the present deferral balance based
on their usage. Id. Avista proposes to transfer these costs with the customer’s account through
revised Schedule 146B. The Customer could then choose to pay this amount by: 1) a lump-sum
refund or surcharge to eliminate the deferred gas cost balance; or 2) an amortization rate per therm to
reduce the deferred gas cost balance prospectively. Id.
YOU ARE FURTHER NOTIFIED that the Company’s present tariff schedules address
the reverse situation – when transportation customers choose to switch back to sales service. Id. at 3.
Tariff Schedules 112, 122 and 132 are available to previous transportation customers and the rates do
not include the present amortization rate applied to other sales customers. These tariffs were created
when gas prices were falling so that a transportation customer could not receive a deferred cost
refund by switching back to sales service. Although these tariffs were not intended for use by
previous sales customers, these tariffs do not currently contain language prohibiting their use. Avista
proposed to change this situation by adding restrictive language to Tariff Schedules 112, 122 and
132.
YOU ARE FURTHER NOTIFIED that Avista currently has no customers served by
Schedules 112 and 122, and only two customers served under Schedule 132. Id. The Petition states
that the deferred gas costs (surcharges or refunds) for these two customers have been determined on
an individual basis and approved by the Commission in prior PGA filings. Id. Avista’s proposed
tariff revisions for these schedules add the following language to make it clear that only prior
transportation customers may be served under those schedules in the future: “Customers beginning to
take service under the Schedule on and after March 1, 2002 must have been previously served under

NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 28949 -3-
Schedule 146 – Transportation Service for Customer-Owned Gas.” Id.
YOU ARE FURTHER NOTIFIED that Avista’s proposed language changes to Tariff
Schedules 131A and 132A would remove the application of Tariff Schedule 149. Tariff Schedule 149
is no longer applicable and will be removed or the rate set to zero in the next PGA filing. Id.
YOU ARE FURTHER NOTIFIED that Avista requests that this case be processed under
Modified Procedure and that the proposed tariff sheets be effective for gas service rendered on and
after March 1, 2002. Id. at 3-4.
NOTICE OF MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has determined that the public
interest may not require a formal hearing in this matter and will proceed under Modified Procedure
pursuant to Rules 201 through 204 of the Idaho Public Utilities Commission's Rules of Procedure,
IDAPA 31.01.01.201 through .204.
YOU ARE FURTHER NOTIFIED that the Commission may not hold a hearing in this
proceeding unless it receives written protests or comments opposing the use of Modified Procedure
and stating why Modified Procedure should not be used. Reference IDAPA 31.01.01.203.
YOU ARE FURTHER NOTIFIED that any person desiring to state a position on this
Application may file a written comment in support or opposition with the Commission on or before
Tuesday, February 26, 2002. The comment must contain a statement of reasons supporting the
comment. Persons desiring a hearing must specifically request a hearing in their written comments.
Written comments concerning this Application shall be mailed to the Commission and the Applicant at
the addresses reflected below:
Commission Secretary
Idaho Public Utilities Commission
PO Box 83720
Boise, ID 83720-0074

Street Address for Express Mail:

472 W. Washington Street
Boise, ID 83702-5983
Kelly O. Norwood
David J. Meyer
Avista Utilities
1411 East Mission
P.O. Box 3727
Spokane, WA 99220-3727
E-mail: [e-mail]
[e-mail]

These comments should contain the case caption and case number shown on the first page of this

NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 28949 -4-
document. Persons desiring to submit comments via e-mail may do so by accessing the Commission's
homepage located at www.puc.state.id.us under the "Comments and Questions" icon. Once at the
"Comments and Questions" icon, fill in the case number as it appears on the front of this document,
and enter your comments. These comments must also be sent to the Applicant at the e-mail addresses
listed above.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are received
within the deadline, the Commission will consider the matter on its merits and enter its Order without
a formal hearing. If comments or protests are filed within the deadline, the Commission will consider
them and in its discretion may set the matter for hearing or may decide the matter and issue its Order
on the basis of the written positions before it. Reference IDAPA 31.01.01.204.
YOU ARE FURTHER NOTIFIED that the deadline for the Applicants to file written
reply comments with respect to their Application in this case is Thursday, February 28, 2002.
YOU ARE FURTHER NOTIFIED that the Application together with supporting
workpapers, testimonies and exhibits, have been filed with the Commission and are available for
public inspection during regular business hours at the Commission offices. The Application and
testimonies (excluding exhibits) are also available on the Commission's Website at
www.puc.state.id.us under the "File Room" icon.
YOU ARE FURTHER NOTIFIED that all proceedings in this case will be held pursuant
to the Commission's jurisdiction under Title 61 of the Idaho Code and that the Commission may enter
any final Order consistent with its authority under Title 61.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be conducted
pursuant to the Commission's Rules of Procedure, IDAPA 31.01.01.000 et seq.
O R D E R
IT IS HEREBY ORDERED that this matter be processed under our rules of Modified
Procedure. IPAPA 31.01.01.201-204.
IT IS FURTHER ORDERED that the Commission does hereby solicit written comment
on this Application from the public, Applicant and Commission Staff in accordance with the foregoing
schedule.

NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
-5-
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho, this 5th
day of February 2002.

PAUL KJELLANDER, PRESIDENT

MARSHA H. SMITH, COMMISSIONER

DENNIS S. HANSEN, COMMISSIONER

ATTEST:

Jean D. Jewell
Commission Secretary

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