20171025notice_of_proposed_settlement_order_no_33920.pdf

Office of the Secretary
Service Date
October 25,2017
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )CASE NOS.AVU-E-17-01
OF AVISTA CORPORATION DBA )AVU-G-17-01
AVISTA UTILITIES FOR AUTHORITY )
TO INCREASE ITS RATES AND )NOTICE OF
CHARGES FOR ELECTRIC AND )PROPOSED SETTLEMENT
NATURAL GAS SERVICE IN IDAHO )
)NOTICE OF
)AMENDED SCHEDULE
)NOTICE OF TECHNICAL
)HEARING
)ORDER NO.33920
On June 9,2017,Avista Corporation filed an Application seeking authority to
increase the Company's general rates for electric and natural gas service in Idaho.Avista
proposed a two-year rate plan that would increase annual electric billed revenues by $18.6
million (7.9%)on January 1,2018,and by $9.9 million (4.2%)on January 1,2019,and increase
in annual natural gas revenues by $3.5 million (5.7%)on January 1,2018,and by $2.1 million
(3.3%)on January 1,2019.
The Commission issued a Notice of Application and Notice of Intervention Deadline
and suspended the proposed effective date to January 1,2018.Order No.33808.Clearwater
Paper,Idaho Conservation League (ICL),Idaho Forest Group,the Community Action
Partnership Association of Idaho (CAPAI),and Sierra Club were granted intervention as parties.
The Commission also set deadlines for the parties to file testimony and exhibits,and scheduled
public workshops,and a technical hearing.See Order Nos.33825 and 33837.
On October 17,2017,Staff notified the Commission that a settlement had been
reached and moved the Commission to amend the case schedule.On October 20,2017,Staff
filed the proposed settlement,and a motion to approve the stipulation and settlement.The
Settlement is signed and supported by all parties except Sierra Club and ICL.
With this Order,we provide notice of the settlement,amend the case schedule,and
set a technical hearing.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF AMENDED SCHEDULE
NOTICE OF TECHNICAL HEARING
ORDER NO.33920 1
NOTICE OF PROPOSED SETTLEMENT
YOU ARE HEREBY NOTIFIED that,in summary,the Stipulation and Settlement
proposes to fully resolve the case as follows:
L Overview of Settlement and Revenue Requirement
If approved,Avista would be allowed to make changes to its tariff schedules designed
to increase annual base electric revenue by $12.9 million (about 5.1%billed),effective January
1,2018,and $4.5 million (about 1.7%billed),effective January 1,2019.Natural gas base
revenue would increase by $1.2 million (about 1.9%billed),effective January 1,2018,and $1.1
million (about 1.8%billed),effective January 1,2019.
Avista further agreed to a two-year stay out provision-thatit will not file an electric
or natural gas rate case before May 31,2019,with any rate changes going into effect after
January 1,2020.This provision excludes the Company's annual filings for its power cost
adjustment,fixed cost adjustment,purchased gas adjustment,and other regular annual
adjustment mechanisms.Avista agreed to abstain from making deferred accounting requests,or
requests to create a regulatory asset during the two-year stay-out period,except in extraordinary
circumstances.
2.Capital Structure and Cost of Capital
If the settlement were approved by the Commission,Avista's capital structure and
weighted-averagecost of capital (rate of return)would be:
Weighted
Capital Average Cost
Component Structure Cost of Capital
Debt 50%5.72%2.86%
Common Equity 50%9.50%4.75%
Total 100%7.61%
i The actual Stipulation and Settlement,including its attachments,is about 55 pages long and far more detailed than
this summary.Interested persons may view the actual Stipulation and Settlement on the Commission's web site.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF AMENDED SCHEDULE
NOTICE OF TECHNICAL HEARING
ORDER NO.33920 2
3.Percentage Increase by Service Schedule
The resulting percentage increases to Avista's base rates and billing rates are reflected
below by schedule:
ResultingPercentage Increase by Electric Service Schedule
Effective January 1,2018:
Increase in Incavase in
Rate Schedule Itase Rates Billing Rates
Residental Scheduk I 5 79 5 9'
General Serste Scheduks 11/12 5 09 5 29
large General Scrite Sdedules 21/22 5 49 5 70
Extra large General Serste Sdrduk 25 3.99 4 7'<
Clearwatet Paper Sdedule 25P 3 40 4 S'
Pumping Scrisce Schedule,31/32 5.99 6 IN
Street &Area 1.ights Scheduks 41 48 5.29 5 19
Overall LE ig
Effective Janurary1,2019:
Incrvase in Inctrase in
Rate Schedule Base Rates Billing Rates
Residential Schedule 1 1 99 2 39
GeneralServbe Scheduks I1/12 I 70 2 IU
Large General Service Schedules 21/22 I 89 2 39
Extra Large General Service Schedub 25 I 30 2 25
Clearwater Paper Schedule 25P I W 2 20
PumpingService Schedules 31/32 2 0',2 4'
Street &Area Ughts Scheduks 41-48 1 80 I 99
Overall I N'à 21
ResultingPercentage Increase by Natural Gas Service Schedule
Effective January 1,2018:
Increase in Increase in
Rate Schedule Base ates BRiing Rates
General Sertre Scheduk 101 3.2%2 29
large General Serste Sdedules ll lil 12 L4%0 79
Intermptibt Sertae 5dieduk,1 31/1 12 0.0%0 09
Transportaten Serste Sdedule 146 3.0%3 06
Specul Contracts Sdeduk 148 0.0%0 09
Overall B _1.91
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF AMENDED SCHEDULE
NOTICE OF TECHNICAL HEARING
ORDER NO.33920 3
Effective January 1,2019:
Increase in Incmase in
Rate Nchedule Base Rates Billing Rates
4.Cost of Service Workshop
Prior to May 31,2019,the Company and interested parties shall meet and confer to
discuss the Company's electric cost of service study,and evaluate differing cost of service
methodologies.The Company agreed to provide the Commission with three or more cost of
service studies to reflect the differing methodologies prior to the filing of its next general rate
case.
5.Low Income lssues
The Company agreed to collaborate with interested parties to consider a funding
increase to weatherization and conservation education funding.The Company agreed to file with
the Commission any such request for an increase by December 31,2017.
6.Natural Gas Rules
The Company and interested parties will meet to discuss the Company's tariffs for
compliance with the Commission's service rules for gas utilities.The Company also agreed to
confer with interested parties over the Company's meter placement and protection policies and
practices to determine what,if any,changes should be made by the Company.The Company
agreed to request Commission approval for any such changes by July 1,2018.
7.Performance Measures
The Company and interested parties will work to develop customer performance
standards,customer guarantees,and a reporting mechanism for Idaho customers.The Company
agreed to file a proposal with the Commission requesting implementation for such measures by
July 1,2018.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF AMENDED SCHEDULE
NOTICE OF TECHNICAL HEARING
ORDER NO.33920 4
8.Signing Parties
The Company,Commission Staff,Clearwater Paper,Idaho Forest Group,Community
Action Partnership Association of Idaho have all signed onto the settlement,and represent that
the Stipulation and Settlement is in the public interest and is fair,just,and reasonable.The Idaho
Conservation League,and Sierra Club have not signed onto the settlement.
COMMISSION SETTLMENT RULES
YOU ARE FURTHER NOTIFIED that the Commission will review the proposed
settlement consistent with Commission Rules 271-280.
YOU ARE FURTHER NOTIFIED that the Commission is not bound by the
agreement of the signing parties.The Commission will independently review the proposed
settlement to decide whether to approve it,reject it,or state conditions under which to accept it.
The proposed settlement's proponents ultimatelybear the burden to prove that it is just,fair,and
reasonable,in the public interest,or otherwise in accordance with law or regulatory policy.
YOU ARE FURTHER NOTIFIED that the Stipulation and Settlement,Application,
and supporting workpapers,testimony,and exhibits are available for public inspection during
regular business hours at the Commission offices.They also may be viewed on the
Commission's web site at by clicking on "File Room"and then "Electric
Cases"and/or "Natural Gas Cases"and then going to the case numbers referenced in the above
caption.
NOTICE OF AMENDED SCHEDULE
YOU ARE FURTHER NOTIFIED that the Commission vacates the existing case
schedule,and replaces it with the followingamended schedule:
DATE ACTIVITY
November 3,2017 Deadline for all parties to file prefiled testimony in
favor of the proposed settlement
November 14,2017 Prefiled reply testimony
November 28,2017 Rebuttal testimony
December 8,2017 Technical hearing,and the close of public
comments.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF AMENDED SCHEDULE
NOTICE OF TECHNICAL HEARING
ORDER NO.33920 5
The parties'prefiled testimony and exhibits must conform to the requirements of
Rules 231,266 and 267 of the Commission's Rules of Procedure.Reference IDAPA
31.01.01.231 and .266-.267.The above deadlines are for testimony and exhibit filing with the
Commission.E-copy service on parties of record should be made on the same date to the extent
practicable with full service of testimony and exhibits provided to parties of record no later than
the followingbusiness day.
NOTICE OF TECHNICAL HEARING
YOU ARE FURTHER NOTIFIED that the Commission will convene a technical
hearing in this matter.The purpose of the technical hearing is to take testimony from the parties
(the Company,Staff,and the signing intervenors)regarding the proposed settlement.The
technical hearing will convene on FRIDAY,DECEMBER 8,2017,AT 9:30 AM (MST)IN
THE COMMISSION'S HEARING ROOM AT 472 WEST WASHINGTON STREET,
BOISE,IDAHO.
YOU ARE FUTHER NOTIFIED that anyone may file written comments with the
Commission about the case through the close of business on December 8,2017.The comments
may be mailed to the Commission at the address referenced in the followingparagraph,or they
may be e-mailed by accessing the Commission's home page located at
Scroll to the "Consumers"tab,click the "Utility Case Comment or Question Form,"and
complete the form using the case number as it appears on the front of this document.
YOU ARE FURTHER NOTIFIED that all hearings in this case will be held in
facilities meeting the accessibility requirements of the Americans with Disabilities Act (ADA).
Persons needing the help of a sign language interpreter or other assistance in order to participate
in or to understand testimony and argument at a public hearing may ask the Commission to
provide a sign language interpreter or other assistance at the hearing.The request for assistance
must be received at least five (5)working days before the hearing by contacting the Commission
Secretary at:
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE,IDAHO 83720-0074
[phone] (Telephone)
[phone] (FAX)
E-Mail:
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF AMENDED SCHEDULE
NOTICE OF TECHNICAL HEARING
ORDER NO.33920 6
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 authorityunder 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.
ORDER
IT IS HEREBY ORDERED that an amended schedule,as set forth above,is adopted.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of October 2017.
PAUL KJELLANDER,PRESIDENT
KRI TINE RAPER,COMMISSIONER
ERIC ANDERSON,COMMISSIONER
ATTEST:
Diane Hanian
Commission Secretary
L\Legal\LORDERS\AVUEI701 AVUGl701 bkS.doc
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF AMENDED SCHEDULE
NOTICE OF TECHNICAL HEARING
ORDER NO.33920 7