20200513Notice_of_Petition_Order_No_34668.pdf

NOTICE OF PETITION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34668 1

Office of the Secretary
Service Date
May 13, 2020
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

AVISTA CORPORATION’S PETITION FOR
APPROVAL OF A SETTLEMENT
AGREEMENT BETWEEN CLEARWATER
PAPER CORPORATION AND AVISTA
CORPORATION
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CASE NO. AVU-G-20-02

NOTICE OF PETITION

NOTICE OF
MODIFIED PROCEDURE

ORDER NO. 34668

On April 7, 2020, Avista Corporation (“Company”) filed a Petition seeking approval
of a settlement agreement (“Agreement”) with Clearwater Paper Corporation (“Clearwater”)
pursuant to Commission Rule of Procedure 53. IDAPA 31.01.01.053. The proposed Agreement
resolves a dispute over a penalty that could have been imposed on Clearwater under the
Company’s Idaho Natural Gas Tariff, Schedule 146 – Transportation Service for Customer-
Owned Gas (“Tariff”). The Company requests that the Petition be processed by Modified
Procedure. Petition at 6.
With this Order, we provide notice of the Petition and set comment and reply
deadlines.
NOTICE OF PETITION
YOU ARE HEREBY NOTIFIED that the Company has a special contract for natural
gas transportation service with Clearwater. Id. at 2; see also Order 30307.
YOU ARE FURTHER NOTIFIED that the Company represents Section 7 of the
special contract makes Clearwater responsible for imbalance charges or penalties as set forth in
the Company’s Tariff. Id.
YOU ARE FURTHER NOTIFIED that the Company states on October 9, 2018, the
Enbridge-owned West Coast Pipeline experienced a rupture that reduced natural gas flows to the
Sumas natural gas trading hub for the entire 2018-2019 wintertime period. Id. at 3. The Company
asserts the rupture, coupled with Jackson Prairie system maintenance and outages, resulted in
unusually high prices and volatility at Sumas. Id.
NOTICE OF PETITION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34668 2

YOU ARE FURTHER NOTIFIED that the Company asserts in February and March
2019, Northwest Pipeline issued certain entitlement notices requiring shippers on their pipeline to
stay within a certain percentage of their nominated natural gas supplies. Id. The Company alleges
it issued the same entitlement notices to its Clearwater and other transportation customers. Id.
YOU ARE FURTHER NOTIFIED that the Company alleges despite these notifications
Clearwater exceeded its nominated natural gas volumes eight times between February 7, 2019 and
March 4, 2019. Those eight exceedances led to imposition of $926,202 entitlement penalties under
the Company’s Tariff (“Penalty”). Id. at 3-4.
YOU ARE FURTHER NOTIFIED that the Company and Clearwater agreed that the
amount of the Penalty was unduly burdensome due to the unique circumstances that existed when
it was incurred. Id. at 4. As a result, the Company asked the Commission for a limited waiver of
certain penalty provisions in the Tariff and permission to enter into settlement discussions with
Clearwater. Id.; see also Order No. 34549.
YOU ARE FURTHER NOTIFIED that after settlement negotiations the Company and
Clearwater agreed to a reduced penalty of $500,000. Id. at 5. The Company asserts this amount
strikes a reasonable balance between providing meaningful deterrence due to the large dollar
amount but not so high as to become unduly burdensome when there was significant turmoil in
natural gas markets. Id. Further, the Company contends there was no financial harm to the
Company’s core customers, nor was it penalized by Northwest Pipeline. Id.
YOU ARE FURTHER NOTIFIED that the Petition is available for public inspection
during regular business hours at the Commission offices. The Petition is available on the
Commission’s web site at www.puc.idaho.gov. Click on the “Natural Gas” tab first, then the
“Open Cases” tab, and then the case number “AVU-G-20-02” as also shown on the front of this
document.
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. 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.

NOTICE OF PETITION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34668 3

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 Commission's Rules of Procedure, IDAPA 31.01.01.201
through .204. The Commission notes that Modified Procedure and written comments have proven
to be an effective means for obtaining public input and participation.
YOU ARE FURTHER NOTIFIED that anyone desiring to state a position on this
Petition must file a written comment in support or opposition with the Commission within twenty-
one (21) days from the service date of this Notice. The comment must explain why the person
who filed them supports or opposes the Petition. Persons desiring a hearing must specifically
request a hearing in their written comments. Written comments concerning this Petition should be
sent electronically to the Commission and the Company at the email addresses reflected below:

Idaho Public Utilities Commission:

Commission Secretary
Idaho Public Utilities Commission
P.O. Box 83720
Boise, ID 83720-0074
Email: [e-mail]

Street Address for Express Mail:

11331 W. Chinden Blvd.
Building 8, Suite 201-A
Boise, ID 83714

Avista:

Michael G. Andrea
Patrick Ehrbar
Avista Corporation
P.O. Box 3727
MSC-17
1411 E. Mission Ave.
Spokane, WA 99220-3727
Email: [e-mail]
[e-mail]

If a person cannot send comments to the Commission by email, they may be submitted by mailing
them to the addresses above. Comments should contain the case caption and case number shown
on the first page of this document. Persons submitting comments by email may do so by accessing
the Commission’s home page located at www.puc.idaho.gov. Click the “Case Comment Form”
under “Consumers”, and complete the comment form using the case number, as it appears on the
front of this document. These comments must also be sent to the Company.
YOU ARE FURTHER NOTIFIED that the Company must file any reply comments
within twenty-eight (28) days from the service date of this Notice.
NOTICE OF PETITION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 34668 4

YOU ARE FURTHER NOTIFIED that if no written comments or protests are received
within the time limit set, the Commission will consider this matter on its merits and enter its order
without a formal hearing. If written comments are received within the time limit set, the
Commission will consider them and, in its discretion, may set the same for formal hearing.
O R D E R
IT IS HEREBY ORDERED that this case be processed by Modified Procedure, Rules
201 – 204 (IDAPA 31.01.01.201 through .204). Persons wishing to file written comments must
do so within twenty-one (21) days from the service date of this Notice. The Company must file
any reply comments within twenty-eight (28) days from the service date of this Notice.
IT IS FURTHER ORDERED that parties continue to comply with Order No. 34602,
issued March 17, 2020. All pleadings should be filed with the Commission electronically and shall
be deemed timely filed when received by the Commission Secretary. See Rule 14.02. Service
between parties should also be accomplished electronically. Voluminous discovery-related
documents may be filed and served on CD-ROM or a USB flash drive.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 13th
day of May 2020.

PAUL KJELLANDER, PRESIDENT

KRISTINE RAPER, COMMISSIONER

ERIC ANDERSON, COMMISSIONER
ATTEST:

Diane M. Hanian
Commission Secretary

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