20210901Final_Order_No_35156.pdf

ORDER NO. 35156 1
Office of the Secretary
Service Date
September 1, 2021
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION
OF AVISTA CORPORATION FOR
AUTHORITY TO INCREASE ITS RATES
AND CHARGES FOR ELECTRIC AND
NATURAL GAS SERVICE TO ELECTRIC
AND NATURAL GAS CUSTOMERS IN THE
STATE OF IDAHO
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CASE NO. AVU-E-21-01
AVU-G-21-01

ORDER NO. 35156

On January 29, 2021, Avista Corporation dba Avista Utilities (“Avista” or “Company”)
applied to increase its rates for electric and natural gas service in Idaho, to be effective on
September 1, 2021, and September 1, 2022. Application at 1. The Company proposed a “Two-
Year Rate Plan” with an increase in electric base revenue of $24.8 million or 10.1% for “Rate Year
1”, and $8.7 million or 3.2% for “Rate Year 2”. Id. For natural gas, the Company proposed an
increase in base revenue of $52,000 or 0.1% for Rate Year 1, and $1.0 million or 2.2% for “Rate
Year 2”. Id.
Avista’s Application proposed to offset these rate increases by the effect of Tax
Customer Credit Tariff Schedules 76 (electric) and 176 (natural gas). Id. Avista asserted
amortization of approximately $31.3 million in electric tax benefits from Schedule 76, beginning
on September 1, 2021, would completely offset the Company’s requested electric rate increase for
Rate Year 1 until about November 30, 2022. Id. at 1-2. However, Avista also represented that its
Idaho electric customers would see an $8.7 million or 3.5% bill increase for Rate Year 2, effective
September 1, 2022. Id. at 2. For natural gas customers Avista proposed to amortize the natural
gas benefits of $12.1 million from Schedule 176, beginning September 1, 2021, over 10 years, or
about $1.2 million in benefits per year. Id. The Company asserted this would offset the slight
increase in Rate Year 1 of $0.1 million and result in an overall reduction for natural gas customers
of approximately 1.8%. Id. For Rate Year 2 the Company proposes to amortize its “Natural Gas
Deferred Depreciation Expense” balance of approximately $0.9 million for one-year, effective
September l, 2022 through August 31, 2023, offsetting the proposed $1.0 million increase through
Separate Deferred Depreciation Credit Tariff Schedule 177. Id. The Company asserted customers
would therefore see an overall slight bill impact, effective September 1, 2022, of 0.1%. Id.
ORDER NO. 35156 2
The Commission issued a Notice of Application and granted intervention to the Idaho
Conservation League (“ICL”), Walmart, Inc., (“Walmart”) the Community Action Partnership
Association of Idaho, Inc., (“CAPAI”), the Idaho Forest Group LLC (“IFG”) and Clearwater Paper
Corporation (“Clearwater”) (collectively with Avista and the Commission Staff the “Parties”). See
Order Nos. 34940, 34953, 34958, and 34967.
On April 23, 2021, the Commission set deadlines for the parties to file testimony and
exhibits and set dates and times for a public workshop, public hearing and technical hearing. See
Order No. 35010.
The parties held settlement discussions on May 19, 2021, and June 4, 2021. On June
14, 2021, the Company filed a Motion for Approval of Stipulation and Settlement (“Motion”) with
a copy of the proposed Stipulation and Settlement (“Settlement”) attached thereto.1 The
Settlement was signed and supported by all Parties.
On June 25, 2021, the Commission issued an Order providing Notice of the Proposed
Settlement and amending the case schedule. See Order No. 35087. The amended schedule
included: 1) deadlines for filing testimony supporting the Settlement; and 2) deadlines for filing
written comments. Id. at 4. The amended schedule included a public workshop and a separate
public telephonic hearing for customers of the Company, public officials and any other person not
related to Parties. Id. at 5-7. The amended schedule also set a technical hearing for August 2 and
3, 2021. Id. at 7.
TERMS OF THE STIPULATION AND THE SETTLEMENT
1. Overview of Settlement and Revenue Requirement
The proposed Settlement was executed by Avista and all other Parties. The Settlement
provides Avista should be allowed to increase annual base electric revenue by $10.6 million, or
4.3%, effective September 1, 2021, and increase base electric revenue by $8.0 million, or 3.1%,
effective September 1, 2022. Settlement at 3. For natural gas, Avista would decrease natural gas
base revenue by $1.6 million, or 3.7%, effective September 1, 2021, and increase natural gas base
revenue by $0.9 million, or 2.2%, effective September 1, 2022. Id. at 3-4.
2. Tax Customer Credit
The Parties agree that Avista would return to customers the Tax Customer Credits
available of approximately $31.3 million for electric and $12.1 million for natural gas, through

1 Avista and the Commission Staff executed the Motion.
ORDER NO. 35156 3
Tariff Schedules 76 (electric) and 176 (natural gas). Id. at 4. For Rate Year 1 electric, an amount
equal to the base rate increase in the Settlement would be returned to customers. Id. at 4, 19-20.
For Rate Year 2 electric, the Parties agreed Avista would return the remaining balance of the Tax
Customer Credit, offsetting the overall base rate increase effective September 1, 2022. Id. at 20.
In addition, the Parties agreed that $250,000 of the Tax Customer Credit applicable to Schedule
11 would be allocated to Schedule 25. Id. For natural gas, Avista would return the Tax Customer
Credit starting September 1, 2021, over a ten-year period. Id. The remaining balance of the
Natural Gas Tax Customer Credit and the amortization period will be subject to review and
possible modification during the Company’s next general rate case. See Direct Testimony of
Elizabeth M. Andrews at 6; see also Direct Testimony of Donn English at 8-9.
3. Capital Structure and Cost of Capital
The Parties agreed to a 9.4% return on equity, with a 50% common equity ratio.
Avista’s capital structure and weighted-average cost of capital (rate of return) would be:

Component

Capital
Structure

Cost

Weighted-
Average Cost
of Capital
Debt 50% 4.70% 2.35%
Common Equity 50% 9.40% 4.70%
Total 100% 7.05%

Id.
4. Percentage Increase for Electric Service by Schedule
The tables below reflect the agreed-upon percentage change by schedule for electric
service:

Effective September 1, 2021 (Rate Year 1)
Rate Schedule
Increase in Base
Revenue
Increase in Billing
Revenue before
Offset
Change in Billing
Revenue with
Offset
Residential Schedule 1 4.9%4.9%0.6%
General Service Schedules 11/12 4.3%4.1%0.0%
Large General Service Schedules 21/22 4.3%4.1%0.0%
Extra Large General Service Schedule 25 4.3%4.2%0.0%
Clearwater Paper Schedule 25P 1.1%1.0%-3.1%
Pumping Service Schedules 31/32 4.3%4.2%0.0%
Street & Area Lights Schedules 41-48 4.3%4.2%0.0%
Overall 4.3%4.2%0.0%
ORDER NO. 35156 4

5. Percentage Increase for Natural Gas Service by Schedule

The tables below reflect the agreed-upon percentage change by schedule for natural gas
service:

Effective September 1, 2022 (Rate Year 2)
Rate Schedule
Increase in Base
Revenue
Increase in Billing
Revenue before
Offset
Change in Billing
Revenue with
Offset
Residential Schedule 1 4.3%4.4%0.3%
General Service Schedules 11/12 0.8%0.8%-2.5%
Large General Service Schedules 21/22 3.1%3.1%-0.8%
Extra Large General Service Schedule 25 3.1%3.1%-2.2%
Clearwater Paper Schedule 25P 0.8%0.8%-3.2%
Pumping Service Schedules 31/32 3.1%3.1%-0.8%
Street & Area Lights Schedules 41-48 3.1%3.1%-0.8%
Overall 3.1%3.2%-0.8%
Effective September 1, 2022 (Rate Year 2)
Change in Change in
Rate Schedule Margin Revenue Billing Revenue
General Service Schedule 101 2.2%1.6%
Large General Service Schedules 111/112 2.2%1.3%
Transportation Service Schedule 146 2.2%2.3%
Overall 2.2%1.5%
Effective September 1, 2021 (Rate Year 1)
Change in
Change in Billing
Revenue
Change in
Billing Revenue
Rate Schedule Margin Revenue before Offset with Offset
General Service Schedule 101 -3.7%-2.6%-4.6%
Large General Service Schedules 111/112 -3.7%-2.1%-3.7%
Transportation Service Schedule 146 -3.7%-3.7%-6.5%
Overall -3.7%-2.5%-4.5%
ORDER NO. 35156 5
6. Other Settlement Components
A. Power Cost Adjustment Authorized Level of Expense. The Parties agreed to the
new level of power supply revenues, expenses, retail load, and Load Change Adjustment Rate
resulting from the September 1, 2021, settlement revenue requirement for the monthly Power Cost
Adjustment (“PCA”) mechanism calculations detailed in Appendix A to the Settlement. Id. at 17.
B. Electric and Natural Gas Fixed Cost Adjustment Mechanisms Authorized Base.
The Parties agreed to the new level of baseline values for the electric and natural gas
fixed cost adjustment mechanism (“FCA”) resulting from the September 1, 2021, and September
1, 2022, settlement revenue requirements in Appendixes B through E attached to the Settlement.
Id.
C. Natural Gas Tax Credit Amortization. The Parties agreed to amortize the
Company’s natural gas tax basis benefit over ten years and carrying through the Two-Year Rate
Plan. Id. However, the amortization period of the remaining balance available at the time of the
Company’s next general rate case will be subject to review and possible change of the amortization
period at that time.
D. Wildfire Balancing Account. The Parties agreed to a two-way Wildfire O&M
Expense Balancing Account to defer the difference in actual O&M Wildfire expenses, up or down,
from the authorized “base” level approved in Rate Year 1 of $1.471 million and Rate Year 2 of
$1.836 million. Id. at 17-18. The balance in the deferral will be included for review and recovery
in future general rate cases. Id. at 18.
E. Energy Imbalance Market (“EIM”). The Parties agreed that effective with the
expected “go live” March 1, 2022, date, the Company will begin to reflect Idaho’s share of
incremental EIM O&M expenses through the PCA up to Idaho’s share of EIM benefits that also
will flow through the PCA. Id. Any incremental EIM O&M expenses exceeding EIM benefits
would continue to be deferred for review and determination of recovery in a future proceeding.
F. Agreed Upon Workshops and Meetings/Conferences.
Avista will work with the interested parties to set a schedule for workshops and meetings
by October 15, 2021, concerning the following matters:
(a) Cost of Service Workshops;
(b) Basic Charge Discussion;
(c) Long-Term Ownership of Colstrip;
ORDER NO. 35156 6
(d) Weather Normalization Discussion;
(e) Neilson Substation and Interconnection Discussion; and,
(f) Customer Service Metrics/Customer Facing Technologies.
Id. at 18-19.
7. Cost of Service/Rate Spread (Base Rate Changes)
The Parties did not agree on any particular cost of service methodology. Id. at 19. In
recognition, however, that certain electric rate schedules are generally above their relative cost of
service, the Parties agreed that electric Schedule 25P should receive 25% of the overall percentage
base rate changes for the September 1, 2021, and September 1, 2022, base rate increases. Id. In
addition, the Parties agreed electric Schedules 11/12 should receive 25% of the overall percentage
base rate change for the September 1, 2022, increase. Id. All other schedules, except electric
Schedule 1, should receive a uniform percentage of the overall base rate revenue increase. Id. The
remaining revenue requirement should be spread to Schedule 1. Id. at 19-20. For natural gas, the
Parties agreed to a uniform percentage of distribution margin increase on September 1, 2021, and
September 1, 2022. Id. at 20.
8. Weather Normalization
Avista agreed to meet and confer with the Commission Staff (“Staff”) and any
interested parties, on its weather normalization methodologies to see what changes, if any, should
be made to further the accuracy of its modeling. Id. at 22.
9. Signing Parties
Avista, Staff, Clearwater, IFG, CAPAI, ICL, and Walmart have signed the Settlement,
and asserted it is in the public interest and is fair, just, and reasonable.
TESTIMONY AND COMMENTS OF PARTIES
Staff and the Company filed testimony supporting the Settlement. ICL filed a
Statement of Position in support of the Settlement.
A. Avista Testimony
Company witness Elizabeth M. Andrews testified the Settlement was produced by
discussions that occurred between the parties. See Direct Testimony of Elizabeth M. Andrews at
7-8. Ms. Andrews represented the parties reached a compromise among differing points of view,
with concessions made by all Parties. Id. Additionally, Ms. Andrews states that the Settlement is
ORDER NO. 35156 7
also the result of extensive audit work conducted through the discovery process, including various
virtual conference discussions with Staff. Id. at 8.
Ms. Andrews testified that, under terms of the Settlement, Avista would implement
revised tariff schedules designed to increase annual base electric revenues by $10.6 million, or
4.3%, effective September 1, 2021, and increase base revenues by $8.0 million, or 3.1%, effective
September 1, 2022. Andrews at 5. For natural gas, Ms. Andrews stated that the Parties agreed
Avista should decrease natural gas base revenue by $1.6 million, or 3.7%, effective September 1,
2021, and increase natural gas base revenue $0.9 million, or 2.2%, effective September 1, 2022.
Id. Ms. Andrews testified these rate changes provide retail revenues to allow the Company the
opportunity to earn the rate of return agreed to in the Settlement for Rate Years 1 and 2. Id. Ms.
Andrews noted that with the use of Tax Customer Credits to offset base rate changes over the Two-
Year Rate Plan, the Settlement provides no base rate change overall for electric customers in Rate
Year 1 and an overall reduction of 0.8% in Rate Year 2. Id. at 8. For natural gas, customers will
see an overall reduction of 4.5% in Rate Year 1 and an overall increase of 1.5% in Rate Year 2.
Id.
Ms. Andrews contended the Settlement is supported by evidence showing the need for
rate adjustments to provide for the recovery of necessary expenditures and investment, the costs
of which are not offset by growth in sales margins. Id. Ms. Andrews also pointed out that the
Settlement enjoys support from a variety of customer groups. Id. Ms. Andrews asserted the
Settlement strikes a reasonable balance between the interests of the Company and its customers,
including low-income customers, and therefore represents a reasonable compromise among
differing interests and points of view. Id. at 29. Ms. Andrews also testified that Avista will not
file another electric or natural gas general rate case to increase base rates before February 1, 2023,
and any such rates will not go into effect before September 1, 2023. Id. at 7. Ms. Andrews stated
this does not apply to tariff filings authorized by or contemplated by the PCA, FCA, or other
miscellaneous annual/regular tariff filings. Id.
According to Company witness Patrick D. Ehrbar, the Settlement includes terms for
rate spread and rate design. See Direct Testimony of Patrick E. Ehrbar at p. 1-3. Mr. Ehrbar
testified that the Settlement contains components for the new level of power supply revenues,
expenses, retail load and Load Change Adjustment Rate resulting from the September 1, 2021,
settlement revenue requirement, for monthly PCA mechanism calculations. Id. at 6. Mr. Ehrbar
ORDER NO. 35156 8
also testified about the new level of baseline values for the electric and natural gas FCAs resulting
from the September 1, 2021, and September 1, 2022, settlement revenue requirements that are
detailed in the Settlement. Id. at 6-7. Mr. Ehrbar also testified about the agreed-upon workshops
and meetings/conferences as described in the Settlement. Id. at 7-8.
B. Staff Testimony
On July 19, 2021, Staff member Donn English filed direct testimony in support of the
Settlement. Mr. English is employed by the Commission as a Program Manager overseeing the
Accounting and Audit Department in the Utilities Division. See Direct Testimony of Donn English
at 1. Mr. English is also the Program Manager overseeing the Technical Analysis Department
with the Utilities Division. Id. Mr. English could not attend the technical hearing held on August
2, 2021, so Terri Carlock, Administrator of the Utilities Division of the Commission sponsored
Mr. English’s testimony and was available to be cross-examined by the Parties. Mr. English
testified that, before the settlement conference scheduled in the case, Staff extensively reviewed
the Company’s Application, associated testimony and workpapers to identify adjustments to the
Company’s revenue requirement request, and prepared to file testimony for a fully litigated
proceeding. See Direct Testimony of Donn English at p. 5. Mr. English also represented that Staff
auditors engaged in an extensive audit of the Company’s regulated operations and worked with
other technical staff from the Utilities Division of the Commission to determine the prudence of
capital additions and verify in-service dates. Id. at 5-6. Mr. English noted that Staff also served
over 180 production requests on the Company as part of its comprehensive investigation. Id. at 8.
Mr. English asserted that because of this investigation Staff was prepared to recommend 27
adjustments to the Company’s requested revenue requirement. Id. at 6. Mr. English testified that
Staff determined the Settlement was reasonable because all 27 revenue requirement adjustments
identified by Staff were incorporated either fully or partially in the Settlement. Id. at 9. Mr.
English testified that the Settlement offers a reasonable balance between the Company’s
opportunity to earn a reasonable return on its investment and affordable rates for customers. Id. at
7. Staff believes the Settlement, supported by the Parties, is in the public interest, fair, just, and
reasonable; and should be approved by the Commission. Id.
Mr. English testified that the proposed Settlement provides a reduction in the
Company’s requested revenue requirement. Id. at 6. Mr. English stated that, in Rate Year 1,
instead of the Company’s proposed electric base rate increase of $24.8 million or 10.1% and a
ORDER NO. 35156 9
natural gas base rate increase of $52,000 or 0.1%, base rates under the proposed Settlement for
Idaho electric customers will increase by $10.6 million or 4.3%, and natural gas customers will
see a base rate decrease of $1.6 million or 3.7%, effective September 1, 2021. Id. at 5. In Rate
Year 2, on September 1, 2022, Idaho electric customers’ base rates under the proposed Settlement
will increase by $8.0 million or 3.1% compared to the originally proposed $8.7 million or 3.5%,
while natural gas customers’ base rates will increase by $0.9 million. Id. These base rate increases
are before any offsets from the Tax Customer Credit Schedule Nos. 76 and 176. Id. at 6. Although
not part of the Settlement, Mr. English testified that for Rate Year 2 for natural gas the Company
proposed to offset the requested natural gas rate increase of approximately $1.0 million by using
the Natural Gas Deferred Depreciation Expense regulatory liability approved in Order No. 34276
in Case Nos. AVU-E-18-03 and AVU-G-18-02 (see Settlement at page 9, para. 14). Id. at 4. The
Natural Gas Deferred Depreciation Expense balance is estimated to be approximately $900,000
through August 31, 2021. Id. The Company is returning these funds to customers, effective
September 1, 2021, to help offset the increase in the Company’s Purchased Gas Cost Adjustment
(“PGA”). See Order No. 35150, Case No. AVU-G-21-03.
Mr. English also testified that, although not contained within the Settlement, Avista
proposed removing transmission assets from the Colstrip Regulatory Asset and depreciate those
transmission assets using the same depreciation rates approved for non-Colstrip transmission
assets. Id. at 15. Mr. English stated that the Company has determined that the transmission assets
will be functional even when Colstrip generating units are no longer functional. Therefore, the
Company proposed to move the Colstrip transmission assets from the Regulatory Asset account to
Plant in Service. Id. Mr. English testified that the stipulated revenue requirement accounts for a
reduction in the Colstrip amortization expense by $125,000. Id. at 16. On June 24, 2021, after the
Settlement was signed by all Parties and filed with the Commission, Avista emailed the Parties
explaining that the Settlement did not address the new depreciation rates for the Colstrip
transmission assets, although embedded in the agreed upon revenue requirement. Id. Because
Avista must use the updated depreciation rates on its books to match the accounting for the Colstrip
transmission assets, the Company seeks specific approval for the change in depreciation rates from
the Commission. Id. All parties concurred that the Commission should specifically address the
depreciation rates for the Colstrip transmission assets. Id.
ORDER NO. 35156 10
Mr. English testified that an important part of the Company’s Two-Year Rate Plan is
to provide rate stability and certainty to customers. Id. at 14. Mr. English also noted that although
not in the Settlement, the parties agreed that other than this Two-Year Rate Plan, base rates from
a general rate case filing would not increase before September 1, 2023. Id. Mr. English asserted
that it is important that the Commission direct the Company not to file another general rate case
with rates effective before September 1, 2023. Id. With that caveat, Mr. English believes the
Settlement represents a fair, just, and reasonable compromise of the positions put forth by all
parties and is in the public interest. Id. Mr. English concluded that Staff recommends the
Commission approve the Settlement without material changes or modifications. Id.
Mike Louis, Program Manager who oversees the Engineering Department of the
Utilities Division of the Commission testified in support of cost of service and rate design issues
agreed to by the Parties and discussed the appropriate level of power supply expenses to be
included in base rates. Direct Testimony of Mike Louis at p. 1-2.
C. ICL Statement of Position
On July 19, 2021, ICL filed a Statement of Position (“Statement”) to support the
Settlement under 31.01.01.255. Statement of Position at 1. ICL filed the Statement as an
alternative to filing testimony so it could avoid the expense of hiring a witness. Id. As a party in
the case, ICL focused on Avista’s proposed spending at the Colstrip coal plant. Id. Through
negotiations, ICL asserted a settlement term was achieved that reduces electric rate base by over
$2 million and reduces annual rates. Id. ICL recommends that the Commission approve the
Settlement.
PUBLIC COMMENTS AND TESTIMONY
One customer filed written comments opposing the rate increase and requesting that
the Company provide her with an analog meter because the existing meter is affecting her health.
No customers testified at the telephonic customer hearing.
COMMISSION FINDINGS AND DECISION
The Commission has jurisdiction over this matter under Idaho Code §§ 61-502 and 61-
503. The Commission has the express statutory authority to investigate rates, charges, rules,
regulations, practices, and contracts of public utilities and to determine whether they are just,
reasonable, preferential or discriminatory, or in violation of any provision of law, and may fix the
same by Order. Idaho Code §§ 61-502 and 61-503.
ORDER NO. 35156 11
The Commission's process for considering settlement stipulations is set forth in its
Rules of Procedure 271-277. IDAPA 31.01.01.271-277. When a settlement is presented to the
Commission, it “will prescribe the procedures appropriate to the nature of the settlement to
consider the settlement.” IDAPA 31.01.01.274. Here, the Commission convened both a technical
hearing and public customer hearing on the Settlement. IDAPA 31.01.01.274. Proponents of a
proposed settlement must show “that the settlement is reasonable, in the public interest, or
otherwise in accordance with law or regulatory policy.” IDAPA 31.01.01.275. Finally, the
Commission is not bound by settlement agreements. IDAPA 31.01.01.276. Instead, 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.” Id.
The Commission has reviewed the Application, Settlement, testimony, and comments.
The Parties have built a substantial record through their filings, negotiations and participation in
hearings setting forth their justifications for signing and supporting the Settlement. We appreciate
the investment of time and resources the Parties have made to participate in this case. The robust
record has assisted the Commission in understanding the important issues. Based on our review
of the record, we find that the Settlement is fair, just and reasonable, in the public interest, and we
approve it.
Pursuant to the terms of the Settlement, Avista will implement tariff schedules designed
to increase annual base electric revenue by $10.6 million, or 4.3%, effective September 1, 2021,
and increase base electric revenue by $8.0 million, or 3.1%, effective September 1, 2022. For
natural gas, Avista will implement tariff schedules that would decrease natural gas base revenue
by $1.6 million, or 3.7%, effective September 1, 2021, and increase natural gas base revenue $0.9
million, or 2.2%, effective September 1, 2022.
The Commission also finds it fair, just, and reasonable for Avista to return to customers
the Tax Customer Credits available of approximately $31.3 million for electric and $12.1 million
for natural gas, through Tariff Schedules 76 (electric) and 176 (natural gas). For Rate Year 1
electric, an amount equal to the base rate increase in the Settlement will be returned to customers.
Id. at 4, 19-20. For Rate Year 2 electric, Avista will return the remaining balance of the Tax
Customer Credit, offsetting the overall base rate increase effective September 1, 2022. In addition,
the Commission finds it fair, just and reasonable for $250,000 of the Tax Customer Credit
ORDER NO. 35156 12
applicable to Schedule 11 to be allocated to Schedule 25. For natural gas, Avista will begin
returning the Tax Customer Credit starting September 1, 2021, over a ten-year period. Id.
However, the amortization period of the remaining balance available at the time of the Company’s
next general rate case will be subject to review and possible change of the amortization period at
that time.
Although not addressed within the Settlement, the Parties agreed to remove Colstrip
transmission assets from the Colstrip Regulatory Asset account and begin depreciating those assets
using the depreciation rates approved for non-Colstrip transmission assets. As noted in Staff
witness English’s testimony sponsored by Terri Carlock, Avista sent an email to the Parties
explaining that the Settlement did not address the new depreciation rates for the Colstrip
transmission assets, although embedded in the agreed upon revenue requirement. All Parties
concurred that the Commission Order in this case should address the depreciation rates for the
Colstrip transmission assets. Because Avista must use the updated depreciation rates on its books
to match the accounting for the Colstrip transmission assets, the Commission finds it fair, just, and
reasonable to approve the change in depreciation rates.
The Commission also acknowledges and accepts Avista’s agreement outside the
Settlement with the Parties to not file another electric or natural gas general rate case to increase
base rates before February 1, 2023, with any such rates not going into effect before September 1,
2023. The Commission memorializes this agreement between Avista and the Parties by our Order.
This agreement and directive do not apply to tariff filings authorized by or contemplated by the
PCA, FCA, or other miscellaneous annual/regular tariff filings. Id.
At this time the Commission reserves decision on any intervenor funding request that
might be made by any intervening party. CAPAI filed a timely Petition for Intervenor funding on
August 17, 2021. The Commission’s review and decision on any such request will be made by a
separate order.
O R D E R
IT IS HEREBY ORDERED that the Settlement regarding Avista’s Application in Case
Nos. AVU-E-21-01 and AVU-G-21-01 is approved.
IT IS FURTHER ORDERED that the Company may implement revised tariff
schedules designed to recover the annual electric and natural gas revenue from Idaho customers
ORDER NO. 35156 13
consistent with the Settlement, with revised rates effective September 1, 2021, as set forth in the
Settlement.
IT IS FURTHER ORDERED that the Company may implement its Tariff Schedules
76 (electric) and 176 (natural gas) to return to customers Tax Customer Credits as set forth in the
Settlement.
IT IS FURTHER ORDERED that Avista is authorized to remove transmission assets
from the Colstrip Regulatory Asset and depreciate those transmission assets using the same
depreciation rates approved for non-Colstrip transmission assets.
IT IS FURTHER ORDERED that Avista shall not file another electric or natural gas
general rate case to increase base rates before February 1, 2023, and any such rates will not go into
effect before September 1, 2023. This does not apply to tariff filings authorized by or contemplated
by the PCA, FCA, or other miscellaneous annual/regular tariff filings. Id.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of this Order with regard to any
matter decided in this Order. Within seven (7) days after any person has petitioned for
reconsideration, any other person may cross-petition for reconsideration. See Idaho Code § 61-
626.

ORDER NO. 35156 14
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 1st day
of September 2021.

PAUL KJELLANDER, PRESIDENT

KRISTINE RAPER, COMMISSIONER

ERIC ANDERSON, COMMISSIONER
ATTEST:

Jan Noriyuki
Commission Secretary

I:\Legal\ELECTRIC\AVUE2101_AVUG2101\orders\AVUE2101_AVUG2101_final_settlement_jh.docx