20140606Decision Memo.pdf

DECISION MEMORANDUM 1
DECISION MEMORANDUM
TO: COMMISSIONER KJELLANDER
COMMISSIONER REDFORD
COMMISSIONER SMITH
COMMISSION SECRETARY
COMMISSION STAFF
FROM: DON HOWELL
DEPUTY ATTORNEY GENERAL
DATE: JUNE 2, 2014
SUBJECT: AVISTA’S APPLICATION TO INITIATE DISCUSSIONS REGARDING
ALTERNATIVES TO FILING A GENERAL RATE CASE, CASE NOS.
AVU-E-14-05 AND AVU-G-14-01
On March 25, 2014, Avista Corporation notified the Commission that it intends to file
a general rate case.1 On May 30, 2014, Avista filed an Application requesting the Commission
open a case to allow interested parties to participate in settlement discussions regarding
alternatives to Avista filing a general rate case this year. More specifically, the Application
states that Avista is interested in identifying parties “that would like to participate . . . in
settlement discussions to extend the existing rate plan.” Application at 1. In Avista’s last
general rate case (AVU-E-12-08/AVU-G-12-08), the Commission approved a “Stipulation and
Settlement” (the “Settlement”) that, among other elements, restricted the Company from
increasing its base rates2 before January 1, 2015. Order Nos. 32740 and 37269.
Avista serves more than 120,000 electric customers and more than 75,000 natural gas
customers in northern Idaho. Avista also generates, transmits and distributes electric power in
parts of eastern and central Washington. The Company also distributes natural gas in Idaho,
Washington, and Oregon.
1 Commission Rule 122 requires utilities to file a Notice of Intent at least 60 days before filing a general rate case.
IDAPA 31.01.01.122.01.
2 Base rates are combined with the annual Power Cost Adjustment (PCA) rates to produce a customer’s overall
energy rate.
DECISION MEMORANDUM 2
THE APPLICATION
In late May 2014, Avista had informal discussions with parties that participated in its
last general rate cases including: Clearwater Paper Corporation; Idaho Forest Group; Community
Action Partnership Association of Idaho (CAPAI); Idaho Conservation League (ICL); Snake
River Alliance (SRA); and Commission Staff. As Avista states in the Application, it discussed
with these parties the possibility of avoiding an expensive and time consuming general rate case.
In essence, Avista is interested in exploring with interested parties the possibility of extending its
existing rate plan, thereby avoiding the need for Avista to file a general rate case. The Company
asserts that the parties identified above “expressed a willingness to meet on June 25, 2014, for
the purpose of exploring an extension of the existing rate plan.” Id. at 2.
Based upon the foregoing, Avista requests that the Commission initiate a case; set a
deadline for intervention; and establish a schedule for settlement conferences to allow the parties
to enter into settlement discussions.
STAFF RECOMMENDATION
Staff concurs in the Company’s proposal to initiate settlement discussions in an effort
to avoid or narrow the issues that may arise in a general rate case. Staff believes it is appropriate
for the Commission to: (1) issue a Notice of Application; (2) grant intervention to the interested
parties listed above; (3) set a deadline for intervention to ensure that other interested persons may
have notice and participate in the settlement conference(s); and (4) convene a settlement
conference on June 25, 2014. The parties may decide to schedule additional settlement
conferences.
COMMISSION DECISION
Does the Commission wish to issue a Notice of Application; grant intervention to
Clearwater, Idaho Forest, CAPAI, ICL, and SRA; set a deadline for other interventions; and
schedule a settlement conference for June 25, 2014?

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