20090616Stipulation and Settlement.pdf

David J. Meyer, Esq.
Vice President and Chief Counsel of
Regulatory and Governental Affairs
A vista Corporation
1411 E. Mission Avenue
P. O. Box 3727
Spokane, Washington 99220
Phone: [phone], Fax: [phone]
RECEIVED
2009 JUN '6 PH 3: 54
U IDAHO.PUBL/fTlUTIES COMM/ŠSION
Donald L. Howell, II
Deputy Attorney General
Idaho Public Utilities Commission Staff
PO Box 83720
Boise, ID 83720-0074
Phone: [phone], Fax: [phone]
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF AVISTA CORPORATION FOR THE
AUTHORITY TO INCREASE ITS RATES
AND CHARGES FOR ELECTRIC AND
NATURAL GAS SERVICE TO ELECTRIC
AND NATURAL GAS CUSTOMERS IN THE
STATE OF IDAHO
)
) CASE NOS. A VU-E-09-0l) AVU-G-09-0l
)
) STIPULATION AND
) SETTLEMENT
)
This Stipulation is entered into by and among A vista Corporation, doing
business as A vista Utilties ("A vista" or "Company"), the Staff of the Idaho Public
Utilties Commission ("Staff'), Clearater Paper Corporation ("Clearater"), Idaho
Forest Group, LLC ("Idaho Forest"), the Community Action Parnership Association of
Idaho ("CAP AI"), the Idaho Community Action Network ("I CAN"), and the Idaho
Conservation League ("Conservation League"). These entities are collectively referred to
as the "Paries," and represent all paries in the above-referenced cases. The Paries
Stipulation and Settlement Page 1 of 18
understad this Stipulation is subject to approval by the Idaho Public Utilties
Commission ("IPUC" or the "Commission").
I. INTRODUCTION
1. The terms and conditions of this Stipulation are set forth herein. The Paries
agree that this Stipulation represents a fair, just and reasonable compromise of all the issues
raised in the proceeding and that this Stipulation and its acceptance by the Commission
represent a reasonable resolution of the multiple issues identified in this Stipulation. The
Paries, therefore, recommend that the Commission, in accordance with RP 274, approve the
Stipulation and all of its terms and conditions without material change or condition.
II. BACKGROUND
2. On Januar 23, 2009, Avista filed an Application with the Commission for
authority to increase revenue from electric and natural gas service in Idaho by 12.8% and
3.0%, respectively. If approved, the Company's revenues for electric base retail rates
would have increased by $31.2 milion anually; Company revenues for natural gas
service would have increased by $2.7 milion anually. The Company requested an
effective date of Februar 23, 2009, for its proposed electric/gas rate increase. By Order
No. 30728, dated Februar 11,2009, the Commission suspended the proposed schedules
of rates and charges for electric and natual gas service for a period of thirt (30) days
plus five (5) months, from Februar 23, 2009, or until such time as the Commission
..
entered an Order accepting, rejecting or modifying the Application in this matter.
3. Petitions to intervene in this proceeding were fied by Clearater, Idaho
Forest, CAP AI, ICAN, and the Conservation League. By varous orders, the Commission
granted these interventions. See, IPUC Order Nos. 30735, 30737, 30745, and 30772.
Stipulation and Settlement Page2 of 18
4. Public workshops for Avista c~stomers were held on May 12,2009, in
Sandpoint, Idaho, and on May 13,2009, in Lewiston, Idaho, for the purose of explaining
the Company's Application, and in order to provide an opportity for customers to ask
questions of Staff. Furher public customer hearings are scheduled for June 16, 2009, in
Moscow, Idaho and June 17,2009, in Coeur d Alene, Idaho. The technical hearing is
scheduled to begin on June 29, 2009.
5. On May 29,2009, Commission Staff, Clearater, Idaho Forest and
CAP AI submitted pre-fied direct testimony. Staff recommended in its prefied testimony
an electric base revenue increase of$8.62 millon or 3.91%, and a natural gas base
revenue increase of$L.89 millon or 2.06%. To offset these rate increases, Staff
recommended that the electric Power Cost Adjustment (PCA) and the Purchase Gas
Adjustment (PGA) be reduced.
6. The Commission Staff filed with the Commission a Notice ofIntent to
Engage in Settlement Discussions. RP 272. A settlement conference was subsequently
held in the Commission offces on June 5, 2009, and was attended by representatives of
all Paries, with the exception of the Conservation League. i
7. Based upon the settlement discussions among the Paries, as a compromise
of positions in this case, and for other consideration as set forth below, the Paries agree
to the following terms:
III. TERMS OF THE STIPULATION AND SETTLEMENT
8. Overview of Settlement and Revenue Requirement. The Paries engaged
i The Conservation League did not pre-fie testimony in this matter.
Stipulation and Settlement Page 3 of18
in productive settlement discussions in the conference held June 5, 2009. After reviewing
the positions of the Paries in attendance, the Company adopted many ofStafts
adjustments. Staff also agreed to tre-up some of its adjustments using actual expense
data or based upon the likelihood of a FERC-issued license. Consequently, the Paries
agree that A vista shall be allowed to implement revised taiff schedules designed to
recover $9,438,000 in additional anual electric revenue and $1,939,000 in additional
anual natual gas revenUe, which represent a 4.29% and 2.11 % increase in electric and
natual gas anual base taiff revenues, respectively?
In reaching settlement, the Paries have agreed to various adjustments to the
Company's filing, which are sumarized in the discussion and in the Tables below. The
Paries anticipate that these adjustments will be further explained in pre-filed testimony in
support of the Stipulation.
The Paries agree that Avista's cost of capital shall be determined using a capital
structue consisting of 50% common stock equity, and 50% long-term debt. The Paries
adopt Staft s recommended retur on equity. A vista's authorized retur on equity shall
be 10.5%; the cost of debt shall be 6.60%. These components produce an authorized rate
of retu of 8.55%.
The Sumar Tables, as set forth immediately below, describe the agreed upon
adjustments to the Company's originally-fied electric and natural gas revenue
requirements. The "letter" of each adjustment described below, corresponds to the
2 The Paries have agreed to the recovery of Spokane River Relicensing Costs in this Docket if FERC issues
its order approving Avista's relicensing application prior to July 22, 2009. If these costs are included in
rates, the electric revenue requirement wil be $12,548,000, or a 5.70% increase in base electric revenues.
See Sections 9(i).
Stipulation and Settlement Page 4 of 18
adjustments listed in the Electric and/or Gas Sumar Tables.
SUMMARY TABLE OF ADJUSTMENTS TO ELECTRIC REVENUE REQUIREMENT
OOOs of Dollars
Revenue
Requirement Rate Base
IAmount As Filed $31,233 $577,434
Adj ustments:
a)
b)
o
p
Return on Eauitv Adjust return on equity to 10.50%(2,257)0
Power Supply Exclude short term contracts; 1 month average gas
Iprice usini: end of May 2009 (13,869)0
Production Property Adjustment Flow through impact of Production & Transmission
adjustments 968 611
Regulatory fees Fee dropped to .001662 by Commission in 2009
(includes net impact of adjustments)(168)0
Labor-Non-Exec Reduce 2009 to actual; excludes 2010 labor expense (299)0
Labor-Executive Remove 2009 & 2010 executive labor expense
I(salaries at current executives anualized level)(59)0
i nformation Services Excludes employees not hired during 2009; includes
efficiency adjustment (200)
Asset Management Adjust for effciencies (88)0
Spokane River Relicensing (1)Exclude; include if receive license prior to July 22,
2009 (and prior to IPUC Order)(3,737)(12,184)
Colstrip Mercury Emission O&M Reduce to latest estimate, exclude 2010 expense (516)0
Incentives (Executives & Non-Remove executives' incentives; remove 6 yr avg. on all
executives)incentives (374)0
Generation O&M exoense Adiust to 2009 level of expense (835)0
) Insurance Expense Adjust to actual (35)0
Miscellaneous A&G Expenses Remove various A&G expenses; including dues,
sponsorships, 50% of Board of Director expenses,
Ross Court, lei:al expenses, etc.(371)0
) CDA Tribe Staff oroooses to adjust rate base to 2009 AMA (183)(1,065)
) Restate Debt Interest Flow through impact of Rate Base adjustments 228 0
Total Adjustments (21,795)(12,638)
Adjusted Amounts (2) (3)$9,438 $564,796
c)
d)
e)
f)
g)
h)
i)
j)
k)
i)
m
n)
(1) Once the license is received and the Spokane River Relicensing adjustment is included in rates for recovery, the net
revenue requirement impact associated with this adjustment wil total $3,110,000, and the increase in net rate base will
total $11,875,000. The net impact includes the impact on the Production Property and Restate Debt adjustments, as well
as a reduction to the amount rate based and related amortization for adjustments made to the revised estimated costs as
of June 30, 2009. See Section 9 (i) below.
(2) If a timely Spokane River License is issued, the total revenue requirement wil be $12,548,000.
(3) Recovery of Montana Riverbed Lease Payments. The Parties agree to the recovery of costs associated with the
payments made by the Company to the State of Montana to resolve the litigation over appropriate lease payments for use
of the riverbed by the Company's Noxon and Cabinet Gorge Hydroelectric Projects. The unamortized balance of lease
payments wil be included in rate base at the Company's overall rate of return and amortized over the remaining eight (8)
years of the ten (10) year lease agreement.
Stipulation and Settlement Page 5 of 18
SUMMARY TABLE OF ADJUSTMENTS TO NATURAL GAS REVENUE REQUIREMENT
OOOs of Dollars
Revenue
Requirement Rate Base
IAmountAs Filed $2,740 $90,491
Adjustments.
a)
d)
f)
Return on Equity Adjust return on equity to 10.50%(354)0
Regulatory fees Fee dropped to .001662 by Commission in 2009
(includes net impact of adjustments)(65)0
Labor-Non-Exec Reduce 2009 to actual; excludes 2010 labor
expense (78)0
Labor-Executive Remove 2009 & 2010 executive labor expense
(salaries at current executives anualized level)(16)0
Information Services Excludes employees not hired during 2009;
includes efficiency adjustment (34)
Incentives (Executives & Non-Remove executives' incentives; remove 6 yr avg.
executives)on all ince ntives (92)0
Insurance Expense Adjust to actual (10)0
Miscellaneous A&G Expenses Remove various A&G expenses; including dues,
sponsorships, 50% of Board of Director
expenses, Ross Court, leQal expenses, etc.(70)0
Restate Debt Interest Flow through impact of Rate Base adjustments (7)0
Capital Additions Adjust 2009 Capital for Allocation adjustment (75)(463)
Total Adiustments $(801)$(463)
e)
g)
k)
In)
n)
p)
q)
¡Adjusted Amounts 1$1,9391 $ 90,0281
9. Sumar of Adjustments.
(a.) Retur on Equity. Reflects the agreed upon capital structure and rate of
return applied to the adjusted rate base. Adopts Staffs recommended retur on equity.
(b.) Power Supply. Reflects adjustments to Avista's original power supply
calculation, as follows:
(i.) Adopts Staffs position to remove short-term contracts already
entered into for the pro forma period, reflecting an approximate reduction in revenue
requirement of $6.8 milion. These costs will be recovered through the PCA, subject to
the 90/10 percent sharing.
Stipulation and Settlement Page 6 of18
(ii.) Uses a one-month average natural gas price as proposed by Staff
but for a more curent period of May 1 through May 31,2009 of $4.79IDth3 for the
unedged portion of the generation, reflecting an approximate reduction in revenue
requirement of $7.1 milion.
(c.) Production Propert Adjustment. This flow through adjustment is directly
linked to all other adjustments in the Stipulation that affect production and transmission
related revenues, expenses, and rate base.
(d.) Regulatory Fees. Reflects the Staff proposed reduction to the regulatory fees
that A vista will pay for 2009 that was determined by the Commission after the Company
fied its Application.
(e.) Labor Non-Executive. Adopts Staffs position which reflects the reduction to
wages for non-executive employees to include the actual wage increases implemented in
2009 and the elimination of any increase in 2010.
(f.) Labor Executive. Reflects the current level of wages for executives,
eliminating any pro forma pay increases in 2009 and 2010.
(g.) Information Services (IS). Adopts most of Sta s recommendation. Reflects
the elimination of labor costs for employees not hired at the time of this stipulation by the
Company, and reflects a reduction to costs for efficiency gains from implementing new IS
procedures.
(h.) Asset Management. Adopts Staff s recommendation which reflects a
reduction to costs for efficiency gains.
3 As compared to the $7.67/Dth used in the Company's fied case.
Stipulation and Settlement Page 7 of18
(i.) Spokane River Relicensing Costs. The base case adopts Staffs position that
removes the Company's revenue requirement and rate base related to the Spokane River
Relicensing costs that were pro formed into the original filing. Given the fact that FERC has
placed the pending relicense on its agenda for June 18, 2009, the Paries have agreed to
include costs associated with relicensing through December 31, 2009, upon issuance of a
new FERC license. If a timely license is issued, the total revenue requirement will be
$12,548,000, or an overall increase of 5.70% (before the PCA offset). The paries agree that
the costs included in the Company's filing associated with the relicensing of the Company's
hydroelectric projects on the Spokane River are deemed prudent and recoverable subject to
an audit review of the final costs. In this case these costs should be included as par of the
base rate increase assuming that a relicensing order issues from FERC granting a new license
prior to July 22, 2009. The capital costs that were pro formed were revised for estimated
costs through June 30, 2009.4 In addition, the anual Protection, Mitigation and
Enhancement (PM&E) costs that were pro formed in the Company's filing have been revised
to remove all 2010 costs and revised to include anual 2009 labor costs that were not
otherwise reflected in the original filing. The net effect of these revisions is a reduction to
revenue requirement for PM&E costs of$263,000. All PM&E costs incured during the six
months ended June 30,2010, will be deferred with a caring charge for subsequent recovery
4 The FERC has scheduled Commission meetings on June 18 and July 16, 2009; on either date it is possible
that FERC may act to approve Avista's pending relicensing application for the Spokane River Projects.
(The actual order, however, may not issue for a few days after the actual meeting, even though t is acted
upon; hence, the date of July 22,2009 was chosen as a deadline.) The FERC has published its agenda for
its June 18,2009 meeting, which identifies Avista's relicensing application as an action item. The agreed
upon increase in base rates shall increase from $9,438,000 to $12,548,000, as par of this Docket. Page 1 of
Appendix 1 is a restatement of the Summary Table of Adjustments shown at pageS, above, to reflect the
inclusion in rates of the Spokane River Relicensing Costs; Page2 of Appendix 1 is a restatement of the
table at page 13, below, to demonstrate the impact of also including such costs on the rates for each
customer class, after reflecting the PCA reduction.
Stipulation and Settlement Page 8 of 18
in rates, as par of the Company's next general rate case. The anual caring charge shall be
the then-curent customer deposit rate.
In the event a license is not issued in accordance with the above time table, the Paries
agree to defer as a regulatory asset (in Account 182.3 - Other Regulatory Assets) Idaho's
share of the depreciation/amortization associated with the aforementioned costs, and PME
costs through June 30, 2010, with a caring charge on the deferral as well as a caring
charge on the amount of costs not yet included in rate base for subsequent recovery in rates,
either in a separate filing or as par of the Company's next general rate case. The anual
caring charge shall be the then-curent customer deposit rate.
G.) Colstrip Mercur Emission O&M. Adopts Staff s proposal to reduce the pro
formed O&M costs associated with the mercur control abatement project at Colstrip to the
revised estimate for December 2009, and exclude the 2010 expense level pro formed by the
Company.
(k.) Compensation Incentives. Adopts Staff s position which reflects the actual
non-executive expenses for the test period, instead of the six-year average proposed by the
Company, and removes all executive incentives included in the Company's test period.
(1.) Generation O&M Expense. Adopts Staff s position. Reflects the 2009 level
of expense for generation O&M, corrects model error, and excludes all 2010 O&M expenses
pro formed by the Company.
(m.) Insurance Expense. Adopts Staffs position and adjusts to reflect the actual
expenses for 2009.
(n.) Miscellaneous Expenses. Adopts Staffs proposal to remove VarOUS
administrative and general costs, including dues/sponsorships ($70,000 electric 1 $11,000
Stipulation and Settlement Page 9 of 18
gas), 50% of Board of Director expenses ($151,000 electric 1 $37,000 gas), non-recuring
costs for the design of the Ross Cour building ($138,000 electric), and certn non-recurng
legal expenses ($12,000 electric 1 $23,000 gas).
(0.) Coeur d Alene Tribe Settlement. The Paries agree to the recovery of costs
associated with the settlement of issues involving the Coeur d Alene Tribe litigation and
adopt Staff s proposal to utilze the average of monthly averages level of associated rate base
through December 31, 2009.
(p.) Restate Debt Interest. Reflects the income tax effect ofthechange in interest
expense related to all other adjustments in the Stipulation that affect rate base. This
adjustment restates debt interest using the agreed-upon pro forma weighted average cost of
debt of3.3%.
(q.) Capital Additions (Natual Gas Only). Adopts Staffs position to reflect the
revenue requirement and rate base reduction for capital costs and expenses reflecting a lower
allocation of natural gas capital blanets to the Idaho natural gas operations.
10. Recovery of Lancaster Costs. The Company requested the recovery of the
costs associated with the Lancaster Tollng Agreement though the PCA. 5 Stahas reviewed
the purchase of the output from Lancaster and has found it reasonable, and has agreed to the
recovery of these costs through the PCA, with full recovery of the fixed costs6, but with the
variable fuel costs subject to the 90/1 0 sharing under the PCA.
11. PCA Authorized Level of Expense. The Company will compute, as par
5 The Lancaster power plant is a 275 MW gas-fired combined cycle combustion turbine located in
Rathdrm, Idaho. A vista Utilties wil purchase all of the output of the plant through 2026.
6 As noted in Staff witness Hessing's pr6-fied testimony, fixed power supply costs are normally included in
base rates for full recovery in a general rate case once these costs have been found to have been prudently
incured. (Hessing Direct, at p. i i, lines 4- i 6)
Stipulation and Settlement Page 10 of 18
of its compliance fiing, the level of power supply expense, retail load and revenue credit
resulting from the final revenue requirement determined by the Commission, for puroses
of the monthly PCA mechanism calculations.
12. Prudency of Energy Effciency Expenditues. The Paries agree that
Avista's expenditues for electric and natural gas energy efficiency programs from
Januar 1, 2008 through November 30, 2008 wil be subject to fuher review for
prudence and recovery in a subsequent docket.
13. Cost of Service. As part of its next general rate case (GRC), the Company
will prepare an analysis of the impacts of allocating 100% of transmission costs to
demand, as well as allocating transmission costs to reflect any peak and off-peak seasonal
cost differences over seven months, rather than assuming ai equal weighting over twelve
months. The Company is also in the process of compilng twelve (12) months of
continuous load data for use in future analysis of costs-of-service, and will share the
results of the consultant's analysis of such data with interested paries as soon as it
becomes available.
14. PCA Sharing Percentage. The Company agrees to withdraw its request to
amend the PCA sharng ratio. The sharng ratio shall remain at its curent value of 90/10.
15. Rate Spreadlate Design.
(a.) The Paries agree that the increase in electric base revenue
ultimately approved by the Commission will be spread on a uniform percentage basis to
all schedules as proposed by Staff
(b.) Adopts Staffs position that there wil be no increase in the basic
charges, monthly minimum charges, or demand charges in Schedules 11, 21 and 25.
Stipulation and Settlement Page 11 of 18
(c.) Otherwse, a uniform percentage increase will be applied to each
energy rate within each electric service schedule as proposed by Staff.
(d.) Adopts Staffs position that the curent residential electric basic
charge of$4.60 per month and the residential natural gas basic charge of $4.00 per month
will remain unchanged.
(e.) Effective Date for New Rates. Based upon the Settlement of all
the issues, the Paries agree that the effective date for new electric and natural gas rates
should be August 1, 2009.
(f.) Electric Rates. Coincident with the effective date of the increase in
base electric rates, the Paries have agreed to reduce the stated Power Costs Adjustment
Clause (PCA) electric surcharge (see Tarff Schedule 66) so that the overall reduction in
revenue is 4.2%. After giving effect to this offsetting reduction in the PCA rate, the
following table reflects the change in energy rates agreed to by the Paries:
Stipulation and Settlement Page 12 of 18
ELECTRIC SERVICE CHANGE IN RA TES(I)I(i)
Increas Energy Rate Change in PCA Rate
NetChanl!e
Residential (i)4.6%(3.8%)0.8%
General Services (l i)4.6%(3.3%)1.%
Lg. General Services (2 i)5.3%(5.0%)0.3%
Ex. Lg. General Services (25)5.1%(6.8%)(1.7%)
Potlatch (25P)4.8%(7.1%)(2.3%)
Pumping Service (31)4.4%(3.9%)0.5%
(I) The increase in the energy rate was determined based on a uniform percentage increase in total revenue for
each schedule. The change in the peA rate was determined on a uniform cents per kWh basis applicable to
all schedules, as required by Order No. 30361.
(2) The final changes to energy rates wil var slightly depending on the inclusion of the Spokane River
Relicensing. (See Appendix 1 Page 2.)
(g.) Gas Rates. Coincident with the effective date of the increase in
base natual gas rates, the Paries have agreed to reduce the Company's Weighted
Average Cost of Gas (W ACOG) by reducing the present rate reflected under Schedule
150 - Purchased Gas Cost Adjustment, resulting in a net overall revenue change for
General Service Schedule 101 of 0%. The Staff s proposed rate spread was used to
determine the general revenue requirement increase by schedule. The reduction in the
W ACOG is 2.662 cents per therm, which is equivalent to the general increase per therm
for Schedule 101. Applying this same reduction in the W ACOG of 2.662 cents per therm
for the remaining schedules, results in the net change shown in the table below:
Stipulation and Settlement Page 13 of 18
NATUL GAS SERVICE CHANGE IN RATES(I)
General Change in WACOG
Increase NetChanlle
General Servi:es (10 I)2.1%(2.1%)0%
Lg. General Services (III)2.1%(2.4%)(0.3%)
Interrptible Services (13 I)1.%(2.8%)(1.%)
Transportation Service (146)2.8%-2.8%
(1) The percentages are calculated with all current Schedule i 50 revenue included in base ráe revenue.
16. Customer Service-Related Issues.
(a.) Low Income Legislation - A vista wil support legislation in the
State of Idaho durng the next legislative session in order to establish a Low Income Bil
Payment Assistance Program.
(b.) Low-Income Weatherization Funding - The Paries agree to
maintain the anual level of fuding of $465,000 to Idaho service (CAP) agencies for
fuding of weatherization (which includes administrative overhead). The continuation
and level of such funding will be revisited in the Company's next general rate filing, or
other appropriate proceeding.
(c.) Funding for Outreach for Low-Income Conservation - The Paries
agree that anual fuding in the amount of $25,000 will be provided to Idaho CAP
agencies for the purose of underwiting the dedication of agenc¥ personnel to assist in
low-income outreach and education concernng conservation. This amount will be
fuded through the Energy Efficiency Tariff Rider (Schedules 91 and 191), and will be in
addition to the $465,000 of Low-Income Weatherization Funding. The continuation and
level of such fuding will be revisited in the Company's next general rate fiing or other
appropriate proceedings.
Stipulation and Settlement Page 14 of 18
(d.) Payment Plans - The Company agrees to confer with Staf to
assess the effectiveness of its new payment plans and identify ways to decrease defaults
on payment arangements.
(e.) Low-Income Deposit Requirements - As proposed by Staff, the
Company wil underte a study to evaluate the effectiveness of its deposit policies and
practices.
17. The Paries agree that this Stipulation represents a compromise of the
positions of the Paries in this case. As provided in RP 272, other than any testimony
filed in support of the approval of this Stipulation, and except to the extent necessar for
a Par to explain before the Commission its own statements and positions with respect to
the Stipulation, all statements made and positions taken in negotiations relating to this
Stipulation shall be confidential and wil not be admissible in evidence in this or any
other proceeding.
18. The Paries submit this Stipulation to the Commission and recommend
approval in its entirety pursuant to RP 274. Paries shall support this Stipulation before
the Commission, and no Par shall appeal a Commission Order approving the
Stipulation or an issue resolved by the Stipulation. If this Stipulation is challenged by any
person not a par to the Stipulation, the Parties to this Stipulation reserve the right to file
testimony, cross-examine witnesses and put on such case as they deem appropriate to
respond fully to the issues presented, including the right to raise issues that are
incorporated in the settlement terms embodied in this Stipulation. Notwthstanding this
reservation of rights, the Paries to this Stipulation agree that they will continue to support
the Commission's adoption of the terms of this Stipulation.
Stipulation and Settlement Page 15 of 18
19. If the Commission rejects any par or all of this Stipulation or imposes any
additional material conditions on approval of this Stipulation, each Par reserves the
right, upon written notice to the Commission and the other Paries to this proceeding,
within 14 days of the date of such action by the Commission, to withdraw from this
Stipulation. In such case, no Par shall be bound or prejudiced by the terms of this
Stipulation, and each Par shall be entitled to seek reconsideration of the Commission's
order, fie testimony as it chooses, cross-examine witnesses, and do all other things
necessar to put on such case as it deems appropriate. In such case, the Paries
immediately will request the prompt reconvening of a prehearng conference for puroses
of establishing a procedural schedule for the completion of the case. The Paries agree to
cooperate in development of a schedule that concludes the proceeding on the earliest
possible date, taking into account the needs of the Parties in paricipating in hearings and
preparing testimony and briefs.
20. The Paries agree that this Stipulation is in the public interest and that all
of its terms and conditions are fair, just and reasonable.
21. No Par shall be bound, benefited or prejudiced by any position asserted
in the negotiation of this Stipulation, except to the extent expressly stated herein, nor
shall this Stipulation be constred as a waiver of the rights of any Par unless such rights
are expressly waived herein. Execution of this Stipulation shall not be deemed to
constitute an acknowledgment by any Par of the validity or invalidity of any paricular
method, theory or principle of regulation or cost recovery. No Par shall be deemed to
have agreed that any method, theory or principle of regulation or cost recovery employed
in ariving at this Stipulation is appropriate for resolving any issues in any other
Stipulation and Settlement Page 16 of 18
proceeding in the futue. No findings of fact or conclusions ofJaw other than those stated
herein shall be deemed to be implicit in this Stipulation.
22. The obligations of the Paries under this Stipulation are subject to the
Commission's approval of this Stipulation in accordance with its terms and conditions
and upon such approval being upheld on appeal, if any, by a cour of competent
jurisdiction.
23. This Stipulation may be executed in counterpars and each signed
counterpar shall constitute an original document.
Stipulation and Settlement Page 17 of 18
DATED this l~ay ofJune, 2009.
A vista Corporation
By
David J. Meyer
Attorney for Avista Corporation
Clearater Paper Corporation
By
Conley E. Ward
Community Action Parnership
Association
By
Brad M. Purdy
Idaho Conservation League
BY~~__~etse ~
Stipulation and Settlement
Idaho Public Utilities Commission S
By Jl
Donald L. well, II
Attorney for IPUC Staff
Idaho Forest Group~
ea J. Miler
Attorney for Idaho Forest Group
LLC
Community Action ,Network
By
Rowena Pineda
Page 18 of 18
08/18/200813:28 FAX [phone] AVIST A CORP II 002/003
RêCEIVEO
l' 'I
DATE tls Lfd; ofJune, 20. 2009 JUN 16 PH 3: 21
Avista Corpration Idaho Public Utilities ~~~\~SiON
BY~I
aviMeyer
Attorney for AvIsta Corporaton
By
Donald L. Howell, n
Attory for IPUC Sta
Cleaate Pape Corpration Idao Forest Group
By By
Coney E. Ward De J. Miller
Anorey for Ido Fores( Group
LLC
Community Action Parership
Associaton
Community Action Network
By By
Brad M. Pudy Rowena Pineda
Idao Conservation League
By
Betsy Bridge
Stipulation an Settlement Page 18 of 18
Jun 16 09 03:02p Brad M. Purdy
.j¡iDATED this -Lday of June, 2009.
A vista Corporation
By
David J. Meyer
Attorney for A vista Corporation
Cleanvater Paper Corporation
By
Conley E. Ward
Community Action Parership
Assoiation
By
._..-...-' .
e-(j );Z¿ d. . r ñ-..-.. Bra&M. PuY-c~
Idaho Conservaton League
By
Betsy Bridge
St;nnTFltion ann ~e.ttlp.mp.nt
208-384-1299
Idaho Public Utilities Commssion Sta
By
Donald L. Howell, II
Attorney for IPUC Staf
Idaho Forest Group
By
Dean J. Miller
Attorney for Idao Foret Group
LLC
Community Action Network
By
Rowena Pineda ~ ~- ~r-_::o c.-)i c=m:i ZenO0-0 0'
-03
uX~ ca(foz
Pi:p~ 1 R ofl R
p.2
;0m("m-..rno
I/flDATED this ~day of June, 2009.
A vista Corporation
By
David J. Meyer
Attorney for A vista Corporation
Clearwater Paper Corporation
~~1c~L.C.h~M~ .~'A~S 1"~. .~~ _~~~Ul~~r\
Community Action Parnership
Association
By
Brad M. Purdy
Idaho Conservation League
By
Betsy Bridge
Stipulation and Settlement
Idaho Public Utilities Commission Staf
By
Donald L. Howell, II
Attorney for IPUC Staff
Idaho Forest Group
Community Action Network
BY~ &.?t..
Rowena Pineda
Page 18 of 18
RECElVEO
toot JUN' 6 PM 4: 03
(Includes Spokane River Relicensing) iDAHO PUBLlí~ .... N
TlUT\ES COMMlt)S\O¡~SUMMARY TABLE OF ADJUSTMENTS TO ELECTRIC REVENUE RJJQUIREMENT
OOOs of Dollars
APPENDIX 1
A VISTA UTILITIES
ELECTRIC SERVICE CHANGE IN RATES
Revenue
Requirement Rate Base
IAmount As Filed $31,233 $577,434
Adjustments:
a)
b)
c)
Return on Eauitv Adjust return on equity to 10.50%(2,257'0
Power Supply Exclude short term contracts; 1 month average gas
lorice usina end of Mav 2009 (13,869'0
Production Property Adjustment Flow through impact of Production & Transmission
adjustments 858 231
Regulatory fees Fee dropped to .001662 by Commission in 2009
l(includes net imoact of adiustments)(168'0
Labor -Non-Exec Reduce 2009 to actual; excludes 2010 labor expense (299)0
Labor-Executive Remove 2009 & 2010 executive labor expense
I(salaries at current executives anualized level)(59'0
Information Services Excludes employees not hired during 2009; includes
effciencv adiustment (200'
Asset Manai:ement Adjust for effciencies (88)0
Spokane River Relicensing (1)Exclude; include if receive license prior to July 22,
. 2009 (and orior to IPUC Order)(310)(309)
Colstrip Mercury Emission O&M Reduce to latest estimate, exclude 2010 exoense (516)0
Incentives (Executives & Non-Remove executives' incentives; remove 6 yr avg. on all
executives)incentives (374'0
Generation O&M expense Adjust to 2009 level of exoense (835)0
) Insurance Expense Adjust to actual (35'0
Miscellaneous A&G Expenses Remove various A&G expenses; including dues,
sponsorships, 50% of Board of Director expenses,
Ross Court, leoal expenses, etc.(371)0
CDA Tribe Staff proposes to adjust rate base to 2009 AMA (183 (1,065)
Restate Debt Interest Flow through impact of Rate Base adjustments 21 0
Total Adjustments (18,685)(1,143)
Adjusted Amounts (1)$12,548 $576,291
d)
e)
f)
g)
h)
i)
j)
k)
i)
m
n)
0)
p.)
(1) Recovery of Montana Riverbed Lease Payments. The Parties agree to the recovery of costs associated with the
payments made by the Company to the State of Montana to resolve the litigation over appropriate lease payments for use
of the riverbed by the Company's Noxon and Cabinet Gorge Hydroelectric Projects. The unamortized balance of lease
payments will be included in rate base at the Company's overall rate of return and amortized over the remaining eight (8)
years of the ten (10) year lease agreement.
Page 1 of 2
APPENDIX 1
A VISTA UTILITIES
ELECTRIC SERVICE CHAGE IN RATES
(Includes Spokane River Relicensing)
RECEiVED
ioo~ JUM ,(; PM It: 03
IDAHO PUBliC . . i
UTlUTIES COMMISSION
ELECTRIC SERVICE CHANGE IN RATES (1)/(2)
Increase Enerl! Rate Change in PCA Rate Net Change
Residential (I)6.1%-3.8%2.3%
General Services (11)6.2%-3.3%2.9%
Lg. General Services (2 i)7.1%-5.0%2.1%
Ex. Lg. General Services (25)6.8%-6.8%0.0%
Potlatch (25P)6.4%-7.1%-0.7%
Pumping Service (31)5.8%-3.9%1.9%
(1) The increase in the energy rate was determined based on a uniform percentage increase in total revenue for each schedule (net overall
increase in revenue is 5.7%). The change in the PCA rate was determined on a uniform cents per kWh basis applicable to all schedules, as
required by Order No. 30361 (net overall reduction in revenue is 4.2%). After giving effect to the reduction in the PCA surcharge, the net
increase in the overall revenue change is 1.5%.
-1
Page 2 of2