20210727Notice_of_Application_Order_No_35116.pdf

NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 35116 1
Office of the Secretary
Service Date
July 27, 2021
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION
OF AVISTA UTILITIES FOR AN ORDER
APPROVING A CHANGE IN RATES FOR
PURCHASED GAS COSTS AND
AMORTIZATION OF GAS-RELATED
DEFERRAL BALANCES
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CASE NO. AVU-G-21-04

NOTICE OF APPLICATION

NOTICE OF
MODIFIED PROCEDURE

ORDER NO. 35116

On July 2, 2021, Avista Corporation dba Avista Utilities (“Company”) filed its annual
Purchased Gas Cost Adjustment (“PGA”) Application. The PGA is a Commission-approved
mechanism that adjusts rates up or down to reflect changes in the Company’s costs to buy natural
gas from suppliers—including changes in transportation, storage, and other related costs. The
Company defers these costs into its PGA account and then passes them on to customers through
an increase or decrease in rates.
The Company states its proposal will increase rates for an average residential or small
commercial customer by $6.00 per month (12.1%). The Company states it will send a customer
notice to each customer and has issued a press release to interested media outlets. The Company
asks that its Application be processed by Modified Procedure and that the new rates take effect
September 1, 2021.
NOTICE OF APPLICATION
A. Overview of Proposed Rates
YOU ARE HEREBY NOTIFIED that the Company is a public utility that distributes
natural gas in northern Idaho, eastern and central Washington, and southwestern and northeastern
Oregon. The Company buys natural gas and then transports it through pipelines for delivery to
customers. In this PGA Application, the Company proposes to: (1) pass any change in the
estimated cost of natural gas for the next 12 months to customers (Tariff Schedule 150); and (2)
revise the amortization rates to refund or collect the balance of deferred gas costs (Tariff Schedule
155). The Company has filed an application in AVU-G-21-03 addressing credits that could offset
a portion of the increases in this case. The Company proposes to change its PGA rates in this case
for its customer classes as follows:
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 35116 2

Service

Schedule
No.
Commodity
Change per
Therm
Demand
Change
per Therm
Total
Sch. 150
Change
Amortization
Change per
Therm
Total Rate
Change per
Therm
General 101 $0.04022 $0.00238 $0.04260 $0.05259 $0.09519
Lg. General 111 $0.04022 $0.00238 $0.04260 $0.05259 $0.09519
Lg. General 112 $0.04022 $0.00238 $0.04260 $ - $0.04260
Interruptible 131 $0.04022 $ - $0.04022 $ - $0.04022
Transportation 146 $ - $ - $ - $ - $ -

Application at 3. The Company asserts it is filing this Application earlier than the typical August-
September timeframe to limit the bill impact to customers from the accumulated deferral and
amortization surcharge balances that have increased due to rising natural gas costs in recent months
since the Company’s last filing. Id. The Company’s proposed changes to Schedules 150 and 155
and the Company’s rates are further explained below.
B. Schedule 150
YOU ARE FURTHER NOTIFIED that the Tariff Schedule 150 portion of the PGA
has two parts: the “commodity costs” and the “demand costs.”
YOU ARE FURTHER NOTIFIED that the Company’s “commodity costs” are the
variable costs at which the Company must buy natural gas. The weighted average cost of gas is
an estimate of those costs. Here, the Company estimates its commodity costs will increase by
$0.04022 per therm, from the currently approved $0.16283 per therm. Id. at 3. To minimize
exposure to potential rising gas costs, the Company states it diversifies how it procures natural gas.
The Company alleges that its procurement strategy includes hedging and estimating the cost of
index purchases. Id.
YOU ARE FURTHER NOTIFIED that the Company’s “demand costs” are its fixed-
capacity costs for interstate transportation and underground storage. Id. at 4. The demand costs
primarily are costs to transport gas on interstate pipelines to the Company’s local distribution
system. Id. The Company proposes a $0.00238 per therm increase in the overall demand rate for
customers on Schedules 101, 111, and 112. Id. This increase is caused by factors including the
Canadian exchange rate, an updated demand forecast, and new rates for the Company’s Canadian
pipelines, effective June 1, 2021. Id.
C. Schedule 155
YOU ARE FURTHER NOTIFIED that Tariff Schedule 155 reflects the amortization
of the Company’s deferral account. The Company’s proposed amortization rate change for
Schedule 101 and Schedule 1l1 is an increase in revenue (or expiration of the existing rebate and
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 35116 3
replacing with a surcharge) of $0.05259 per therm. The current rate applicable to Schedule 101
and Schedule 111 is $0.03754 per therm in the rebate direction; the proposed rate is $0.01505 per
therm in the surcharge direction taking into account the proposed amortization rate change.
YOU ARE FURTHER NOTIFIED that if the Company’s Application is approved as
filed, the Company’s annual revenue will increase by $9.0 million (13.5%).
YOU ARE FURTHER NOTIFIED that the Company asserts it has or will notify
customers of its proposed tariffs by posting notice at each of its Idaho district offices, and through
a press release. Also, the Company states it will send notice to each customer as a bill insert during
the July timeframe.
YOU ARE FURTHER NOTIFIED that the Application and Exhibits are available for
public inspection during regular business hours at the Commission’s office. The Application is
also available on the Commission’s website at www.puc.idaho.gov. Click on the “NATURAL
GAS” tab at the top of the home page, then select “Open Cases” and then locate and click on the
case number as 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 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 Idaho Public Utilities 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
Application may file a written comment explaining why the person supports or opposes the
Application within 21 days of the service date of this Order. Persons desiring a hearing must
specifically request a hearing in their written comments. Comments must be filed through the
Commission website or by email unless computer access is unavailable. To comment
electronically, please access the Commission’s home page at www.puc.idaho.gov. Click the
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 35116 4
“Consumer” tab on the Commission’s webpage and then “Case Comment Form” and complete the
form using the case number as it appears on the front of this document. To file by email, the
customer must email the comments to the email addresses listed below. In addition to submitting
the comments to the Commission Secretary, the customer must also email the Staff and utilities at
the email addresses listed below. If computer access is unavailable, then comments may be mailed
to the Commission, Staff, and utilities at these addresses:
For the Idaho Public Utilities
Commission:

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

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

For Avista:

Patrick D. Ehrbar
David J. Meyer
Avista Utilities
1411 E. Mission Avenue
Spokane, WA 99220-3727
[e-mail]
[e-mail]

YOU ARE FURTHER NOTIFIED that the Company must file any reply comments
within 28 days of the service date of this Order.
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 the Company’s Application be processed by Modified
Procedure, Rule 201-204 (IDAPA 31.01.01.201-.204). Persons interested in submitting written
comments must do so within 21 days of the service date of this Order. The Company must file
any reply comments within 28 days of the service date of this Order.
IT IS FURTHER ORDERED that Parties should continue to comply with Order No.
35058, issued June 3, 2021. 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.
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 35116 5

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 27th day
of July 2021.

PAUL KJELLANDER, PRESIDENT

KRISTINE RAPER, COMMISSIONER

ERIC ANDERSON, COMMISSIONER

ATTEST:

Jan Noriyuki
Commission Secretary

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