20110927Application for Funding.pdf

Brad M. Purdy
Attorney at Law
2019 N. 17th St.
Boise, Idaho 83702
(208) 384- 1299
Cell: [phone]
Fax: [phone]
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2011 S£P 27 PM~: 2'
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HAND DELIVERED
September 27, 2011
Jean Jewell
Secreta, Idaho Public Utilities Commssion
472 W. Washigton St.
Boise,ID 83702
Re: Case No. AVU-E-01-1 1: CAPAI Application for Intervenor Funding
Dear Ms. Jewell:
Included herewith is the original and seven (7) copies of Communty Action Parership
Association ofIdaho's Application for Intervenor Funding in the above-referenced
proceeding. Than you for your acceptace of ths filing.
,~
Brad M. Purdy
Attorney at Law
BarNo. 3472
2019N. 17th St.
Boise, ID. 83702
(208) 384- 1299 (Land)
(208) 384-85 11 (Fax)
bmpurdycIhotmail.com
Attorney for Applicant
Communty Action Parership
Association of Idao
f:(~EI\/ ()
ZIH I SEP 27 PM 4: 2 ,
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF AVISTA CORPORATION FOR THE )
AUTHORITY TO INCREASE ITS RATES )
AND CHAGES FOR ELECTRIC AN )
NATURAL GAS SERVICE TO ELECTRC )
AND NATUL GAS CUSTOMERS IN THE )STATE OF IDAHO )
)
)
)
CASE NOS. AVU-E-11-01
A VU-G-ll-01
COMMITY ACTION
PARTNRSHI ASSOCIA-
TION OF IDAHO'S APPLICA-
TION FOR INTERVENOR
FUNING
COMES NOW, Applicant Communty Action Parership Association ofIdao (CAPAI)
and, pursuant to Idao Code § 61-617A and Rules 161-165 of the Commssion's Rules of
Procedure, IDAP A 31.01.01, petitions ths Commssion for an award of intervenor fuding in the
above-captioned proceeing.
Rule 161 Requirements:
AVISTA is a reguated, electrc and gas public utility with gross Idao intrstate anual
revenues exceeding thee millon, five hundred thousand dollar ($3,500,000.00).
Rule 162 Requirements:
(01) Itemized list of Expenses
Consistent with Rule 162(01) of the Commssion's Rules of Proceure, an itemized list of
all expenses incured by CAPAI in ths proceding is atthed hereto as Exhbit "A."
CAPAI APPLICATION FOR INTERVENOR FUNING 1
(02) Statement of Proposed Findings
The proposed fidings and recommendations of CAP AI are set fort in the comments of
Teri Ottens submitted in ths matter,
1 and reflected in the settlement stipulation curently before
the Commssion to which CAP AI is a signtory.
CAP AI fuly parcipated in every aspect of ths case from the filing of a Petition to
Intervene to the filing of this pleading, and fuly paricipated in settlement negotiations leading to
the Stipulation now before the Commssion for consideration. Consistent with the settlement
stipulation previously submitted to the Commssion for approval, CAP AI makes the following
sumar of Ms. Ottens' comments and presents its statement of proposed findings and
recommendations to the Commission.2
First, Ms. Ottens expressed concern regarding the frequency with which Idaho's three
major electrc public utilities have been filing general rate case applications. A VISTA, for
example, has filed applications seekig general rate increases in four of the past four year.
CAP AI is concerned that A VISTA's low-income customers are already stetched beyond their
means and frequent rate increases will only exacerbate ths fact. In addition, Ms. Ottens
expressed concern that the effect of frequent general rate case filings, coupled with other
mechansms in place to stabilize eargs for Idaho's major electrc utilities, has essentially
shifted the burden and risk of curent economic conditions from utility shareholders to
ratepayers.
Ms. Ottens listed several aspects of the settlement stipulation that mitigates the concerns
expressed above. First, A VISTA agreed to reduce its requested rate increas from 3.7% to 1.1 %.
i Ms. Otens' comments were origilly submitted to the Commission in the form of pre filed diect testiony but
were converted to comments thoug an informl agreement to avoid incurg undue expense in travelling to Coeur
D' Alene for the techncal hearg. The substace of Ms. Otens' comments is identical to her origial testiony.2 For the sae of brevity, ths list is not an exhaustive sumation of vially every issue resolved by the settlement
agreement and for which CAP AI had a position.
CAPAI APPLICATION FOR INTERVENOR FUNING 2
Though every rate increase constitutes a hardship for AVISTA's poorest customers, ths reduced
amount is considerably more palatable.
Incidentally, Ms. Ottens specifically challenges any notion tht the interests of low-
income customers are always best served by simply keeping residential rates as low as possible.
It is CAP AI's position that, depending on what other measures a utility might implement, it
could be far more advantageous for low-income customers to accept a modest rate increase if it
were coupled with a substatial increase in fuding to existing low-income programs, or the
creation of new programs such as bil assistace which A VISTA offers to its residential
customers literally miles away across the border in Washigton. Thus, while all thngs being
equal, CAP AI agrees that lower residential rate increases benefit low-income customers, it isn't
always the most signficant way to benefit those customers.
Another component of the settlement tht somewhat ameliorates CAP AI's concern is
that AVISTA has agreed to not seek any rate increase that is effective prior to April 1,2013.
This helps to reduce the frequency of rate increases discussed earlier.
Of all the chatable progrs, events and causes supported by A VISTA, only the
Company's low-income weatherition assistace (LIWA) program and low-income education
outreach program provide assistace exclusively to low-income customers. Regarding LIW A,
Ms. Ottens's comments provide an explantion of why CAP AI agreed to a settlement that did not
result in an increase in fuding to that program.
First, CAP AI notes that A VISTA ha agreed to a number of increases to its LIW A
program over the past few years briging the curent fuding level to $700,000 anually. This,
Ms. Ottens notes, is higher than the fuding levels of both Idaho Power and Rocky Mountain
Power when calculated on a per capita basis. To ilustrate her point, Ms. Ottens calculated the
CAPAI APPLICATION FOR INTERVENOR FUNING 3
number of residential Idaho customers for each of the thee utilities and divided that into each
utilty's respective LIWA fuding leveL. This calculation reveals that AVISTA is fuding its
program at a level roughy 25% higher tha Rocky Mountain and more than 200% higher than
Idaho Power, the latter of which ha not increased its LIW A fuding since its 2003 general rate
case.
It is CAP AI's position that there ar severa guding priciples in estblishing appropriate
levels of LIW A fuding, including the disparty between the need for fuding and available
resources. In ths respect, all the major electrc utilties have a signficant LIW A backlog.
Another importt guiding priciple, however, is that of "party" between the fudig levels of
the thee utilities. CAP AI firmly believes that in order for rates to be fai, just and reasonable to
utilities and ratepayers alike, it is importt tht the Commission ensure tht the respective levels
of fudig for Idaho's thee major electrc utilities be relatively equal.
If one utility offers substantially higher fuding than the others, as is the case with
AVISTA, then that utility's low-income customers are essentially being favored over other low-
income customers thoughout the state. Simlarly, customers of utilities with inappropriately low
fuding are being discriminated agait. Thus, the priciple of party applies to both the utilities
as well as their customers. Ms. Otens contends tht the eligibilty criteria for parcipation in the
LIW A progrs of all the progrs is the same, the program design characteristics are
relatively equa and, therefore, there is no reason for fuding levels to var signficantly.
Furermore, the costs of LIW A, as with any conservation resource, are ultimately passed
on to. other ratepayers. If one utility falls substatially behid another in terms ofLIWA fuding,
such as Rocky Mounta Power and, paricularly, Idaho Power have done, then a substatial
fuding increase must be ordered for those underfding utilties. The grater the disparty
CAP AI APPLICATION FOR INTERVENOR FUNDING 4
between utilities, the greater the fuding increase and the greater the impact on customers' rates
in order to resolve that disparty. Because there are curently pending general rate increases for
the thee utilities and because AVISTA was the fist case in which settlement negotiations were
conducted, it was necessar for CAP AI to weigh the priciple of addressing low-income "need"
against the disparty in fuding between utilties, the priciple of party, and the priciple of
avoiding the rate impact of large LIW A fuding increases. Afer weighg these principles, it
seemed most compelling to CAP AI to seek increases for Idaho Power and Rocky Mountain
Power before puruing additional fuding from A VISTA. Ths weighg of priciples seemed a
fair and reasoned approach to settlement with AVISTA.
Ms. Ottens pointed to two additional factors that entered into CAP AI's decision to agree
to settle this case without an increase in A VISTA's LIW A fuding. First, regarding LIW A,
AVISTA agreed to Section 13(b) of the Settlement Stipulation which provides that "(t)he
Company and interested paries will meet and confer prior to the Company's next general rate
case filing in order to assess the Low Income Weatherization and Low Income Energy
Conservation Education Programs and discuss appropriate levels of low-income weatherization
fudig in the futue." By the time that such a meetig taes place, CAP AI hopes to have
eliminated the considerable disparty between the fuding levels of the thee utilities and
discussions with A VISTA regarding its fuding level will not be prematue.
Second, AVISTA agreed to increase fuding to its existing Outreach for:Low-Income
Conservation Education Program by 25% frm a total of $40,000 to $50,000, which is in
addition to the $700,000 curently fuded by the Company for LIW A. CAP AI believes that ths
program has proven to be a cost-effective and helpfu tool in increasing understading and
CAP AI APPLICATION FOR INTERVENOR FUNING 5
awareness of energy conservation for AVISTA's low-income customers and the agreed increase
is reasonable.
In sumar, it is CAPAI's recoÍnendation that the Commission accept the proposed
settlement based, in par, on the fact that the Settlement Stipulation stres a fair, just and
reasonable compromise between competing interests and priciples and is in the best overall
interests of all A VISTA ratepayers. Regarding A VISTA's low-income customers, a 1.1 %
increase is obviously preferable to nearly 4%. furermore, the Company's increased fuding to
low-income outreach and education combined with a stay-out for rates until the Sprig of2013,
as well as AVISTA's agreement to discuss whether its existig levels ofLIWA fuding are
adequate prior to the next rate cas are concessions by the Company that justify the settlement.
(03) Statement Showing Costs
CAPAI submits that the costs and fees incured in ths case, and set fort in Exhbit "A,"
are reasonable in amount. CAP AI has historically made a concerted effort to minie its
expenses and maximize the effect tht its efforts have in proceedings before ths Commission.
Though ths matter was settled, because of the broad scope of issues raised by all paries, and due
to the level of CAP AI's involvement, it requied the investment of considerable time and
resources by CAP AI to effectively parcipate and address issues of concern to the general body
of ratepayers.
CAP AI submits tht this case was conducted under what could be characterized as
unprecedented circumstaces. As the Commission is well aware, genera rate proceedings were
filed earlier ths year by A VISTA, Rocky Mountain Power and Idao Power at roughy the same
point in time. Furermore, Rocky Mountan had previously fied a case that, from CAP AI's
perspective, is one of the most signficant filings in the bettr par of the past decade as far as
CAP AI APPLICATION FOR INTERVENOR FUNING 6
low-income issues are concerned. That cas is P AC-E- 11 - 1 3 in which Rocky Mountan
contends that its low-income weatherization progr is not a cost-effective DSM resource and
never willbe under tritional cost-effectiveness criteria. Based on ths premise, Rocky
Mounta is curently seekig Commssion authority to relieve the Company from ever
evaluatig the cost-effectiveness of its progr agai. For reaons beyond the scope ofthis
Application, both the natue and timg of Rocky Mountain's "11 -13" filing, if accepted by the
Commission as viable, have called into question the continued existence of low-income
weatherization.
The 1 1-13 case was fied on April 29, 201 1. A Notice of Application was not issued until
two months later. The 1 1 - 13 case is being processed under modified procedure and comments
are due October 28, 201 1. The three general rate cases were fied subsequent to the 1 1 - 13 case
and Staff quickly scheduled those cases for settlement negotiations staing with the A VISTA
filing, though it was the last of the rate cases fied. Ths procedural and substative scenaro
casts all thee utilities' low-income weatherization programs into considerable uncertty and
has made attempts at settlement in the rate cases awkward for CAP AI who intended to seek
LIW A fuding increases for all thee utilities.
Sta has not agreed to support increased LIW A fudig in any of the genera rate cases
pending a resolution of the 1 1 - 1 3 case which, though the paries canot speculate, might not be
resolved by final order until the end of ths year or early 2012. Ths means that the
Commssion's final resolution of the 11 - 1 3 cas, and the continued existence of LIW A, might be
not be known until afer the general rate cases are resolved. Ths somewhat compromised
CAP AI's settement post in the A VISTA case though CAP AI remais supportve of that
CAP AI APPLICATION FOR INTERVENOR FUNING 7
settlement. CAP AI does not intend, however, to settle either the Rocky Mounta or Idao
Power rate cases due to the staemate that the 1 1 - 13 fiing has caused for LIW A fuding.
The reason tht CAP AI raises these points is to explain that the amount of time and
resources expended by CAP AI's legal counel and expert witness in the A VISTA case have been
increased because ofthe complexity created by the unusua circumstaces curently at play.
Therefore, instead of creating economies of scale for CAP AI, the unprecedented, simultaeous
pendency of the .thee rate cases and the 1 1 - 1 3 filing ha had the opposite effect. CAP AI is in no
way criticizing the Commssion's procedural handling of the cases just refered to, but simply
wishes for the Commssion to be aware of the sensitivities and challenges of navigatig through
these unusua circumstaces and the effects of they have had on the amount of costs and fees
incured by CAP AI in ths case. Thus, CAP AI respectfully submits that the costs incured, and
requested in Exhbit "A," are reasonable in amount.
(04) Explanation of Cost Statement
CAP AI is a non-profit corporation overseeing a number of agencies who fight the causes
and conditions of povert throughout Idaho. CAP AI's fuding for any given effort might come
from a different varety of soures, including governental. Many of those fuding sources,
however, are unpredictable and impose conditions or limitations on the scope and natue of work
eligible for fuding. CAP AI, therefore, has relatively little "discretionar" fuds available for all
projects. Some matters before this Commssion, fuermore, do not quaify for intervenor
fuding by vire of their natue.
Thus, were it not for the availabilty of intervenor fuds and past awards by ths
Commission, CAP AI would not be able to paricipate in cases before ths Commssion. Even
with intervenor fuding, paricipation in Commssion cases constitutes a signficant finacial
CAP AI APPLICATION FOR INTERVENOR FUNDING 8
hardship because CAP AI must pay its expenses as they are incured, not if and when intervenor
fuding becomes available.
(05) Statement of Diference
Although Sta provided valuable input regarding most every issue to ths matter, CAP AI
is the only par who represented the interests of AVISTA's low-income customers and
proposed the conditions agreed to by A VISTA and described herein.
(06) Statement of Recommendation
CAP AI has long submitted tht providing assistace to a utilty's low-income customers
provides system-wide benefits in numerous respects includig, but not limted to, the fact that
low-income weatherization progrs constitute cost-effective, prudent energy resources and that
programs designed to assist low-income customers through education and by other means
reduces the percentage of those customers who might be lost to the Company's system, or more
likely to be untimely in payig their bils due to their dir fiancial circumstaces resulting in
associated costs to other ratepayers. Therefore, the proposas and recommendations made by
CAP AI are "of concern to the general body of utilty users or consumers."
(07) Statement Showing Class of Customer
To the extent that CAPAI represents a specific AVISTA cusomer class, it is the
residential class.
RESPECTFULL Y SUBMITTED, ths 27th day of September, 2011.
/~A!,\'~BmdM. Puy .~
CAP AI APPLICATION FOR INTERVENOR FUNING 9
CERTIFICATE OF SERVICE
I HEREBY CERTIFY thaton the 27th day of September, 2011, I caused to be served on
the individuas listed below, the foregoing document via electronic trsmission.
A VISTA Corporation
Kelly Norwood
PO Box 3727
Spokane, VV i\ 99220.3727
Email: Kelly.norwood(favistacorp.com
David Meyer
POBox 3727
Spokane, VVi\ 99220-3727
Email: david.meyer(favistacorp.com
Commssion Staff:
Kristine Sasser
Deputy Attorney General
472 W. Washington St.
Boise, Id 83702
krs.sassercguc.idaho. gov
Idaho Forest Group, LLC:
Dean J. Miler
420 W. Banock St.
Boise, ID 83702
joe(fmcdevitt -miler .com
Idaho Conservation League:
Benjam J. Otto
710 N. Sixth Streeet
Boise,ID 83702
bbridge(fwildidaho.org
Lar A. Crowley
The Energy Strtegies Institute, Inc.
5549 S. Cliffsedge Ave.
Boise, ID 83716
crowleyla(faol.com
Peter J. Richardson
Greg M. Adas
515 N. 27th St.
PO Box 7218
Boise,ID 83702
CAP AI APPLICATION FOR INTERVENOR FUNDING 10
peter(irichardsonandoleary.com
Don Reading
6070 Hil Rd.
Boise, ID 83703
dreadingCfmindspring.com
Mar LewAllen
Clearater Paper Corp
Marv .lewallenCfclearwaterpapercorp.com
~ ~.¿t:J:~ìturdy. .....¿; --
CAPAI APPLICATION FOR INTERVENOR FUNING 11
EXHIBIT "A"
ITEMIZED EXPENSES
Costs:
Photocopies/postae $45.76
Total Costs $45.76
Fees:
Legal (Brad M. Purdy -78.38 hour CÐ $130.00/h.) $10,189.40
Expert Witness (Teri Ottns - 13.0 hours CÐ $50.00/h.) $650.00
Total Fees $10,839.40
Total Expenses $10,885.16
CAP AI APPLICATION FOR INTERVENOR FUNDING 12