20180615order_no_34085.pdf

Office of the Secretary
Service Date
June 15,2018
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF AVISTA CORPORATION DBA AVISTA )CASE NOS.AVU-E-15-05
UTILITIES FOR AUTHORITY TO )AVU-G-15-01
INCREASE ITS RATES AND CHARGES FOR )
ELECTRIC AND NATURAL GAS SERVICE )ORDER NO.34085
INIDAHO )
On April 10,2018,Avista moved to approve an addendum to the settlement stipulation
approved in the above-captionedmatter (the "Stipulation").Specifically,the Company requested
the Commission approve a one-yearextensionof its electric and natural gas Fixed Cost Adjustment
("FCA")mechanism.The FCA is a rate adjustment mechanism designed to break the link between
the amount of energy a utilitysells and the revenue it collects to recover the fixed costs of providing
service to customers.
The Commission previously approved "an initial FCA term of 3 years,with a review
of how the mechanisms have functioned conducted by Avista,Staff,and other interested parties
followingthe end of the second full-year."Order No.33437 at 5.The approved Stipulation
provided that the Company "may seek to extend the term of the mechanism prior to its expiration."
Stipulation at 10.All effected parties'to the rate case support the proposed extension.
On April 25,2018,the Commission issued notice of the proposed addendum to the
settlement Stipulation,and ordered that the request be processed by modified procedure with a
comment deadline of May 11,2018.Staff filed the only comments and supported the extension
request.
STAFF COMMENTS
Staff summarized the FCA mechanism's terms,and recommended granting the
requested extension.Staff noted that extending the pilotprogram "will provide Staff and interested
parties additional information and recommendations from the third-partyevaluation of Avista's
FCA mechanism in Washington along with an additional year of data."Staff Comments at 3.
'Clearwater Paper was a party to the underlying rate case,but does not participate in the FCA mechanism,and takes
no position in this matter.The Community Action Partnership Association of Idaho,Idaho Conservation League,the
Idaho Forest Group,and the Snake River Alliance are signatories to the motion in support of the extension of the FCA
term.
ORDER NO.34085 1
DISCUSSION AND FINDINGS
The Commission's process for considering settlement stipulations is set forth in
Procedural Rules 271-277.IDAPA 31.01.01.271-277.When a settlement is presented to the
Commission,the Commission will prescribe the procedures for considering it.In this case,the
Commission accepted testimony on "the reasonableness of the settlement and whether acceptance
of the settlement is just,fair,and reasonable,in the public interest,or otherwise in accordance with
law or regulatory policy."IDAPA 31.01.01.274 and .275.We note that the Commission is not
bound by settlement agreements.Rather,the Commission "will independently review any
settlement proposed to it to determine whether the settlement is just,fair and reasonable,in the
public interest,or otherwise in accordance with law or regulatory policy."IDAPA 31.01.01.276.
In its request,the Company stated that it seeks the extension to better sync the Idaho
Commission's review of the FCA mechanism with a simultaneous independent review of the
Company's decoupling mechanism in Washington State.We find this request to be just,fair,
reasonable,and in the public interest.Our review of the record reveals there is no evidence to
suggest any harm will come in granting the extension.Rather,we believe interested parties and
this Commission will benefit from the results of the third-party study when they evaluate the
efficacy of the pilot program.We thus find it appropriate to approve the addendum to the
Stipulation,and extend the Stipulation by one year.
ORDER
IT IS HEREBY ORDERED that the motion to approve the addendum to the Stipulation
is granted.The FCA pilot program's expiration date is extended by one year,from December 31,
2018,to December 31,2019.
ORDER NO.34085 2
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this/T y
of June 2018.
PAUL KJEI DËI RESIDENT
KRISTINE RAPER,COMMISSIONER
ERIC ANDERSON,COMMISSIONER
ATTEST:
Diane M.Hanian
Commission Secretary
ORDER NO.34085 3