Website: www.puc.idaho.gov
Parties propose settlement to Rocky Mountain Power case
Parties in the Rocky Mountain Power rate case are
proposing a settlement that would increase rates for residential and irrigation
customers by 4.89 percent and allow the company an annual revenue increase of
$11.5 million or 8.6 percent. That’s down from the 10.3 percent revenue
increase, or $18.5 million, originally proposed by the company, which would
have resulted in about a 6.7 percent for residential and irrigation customers.
It is now up to the Idaho Public Utilities Commission to
determine whether the settlement is in the best interest of customers. Rocky
Mountain Power serves about 67,000 customers in eastern Idaho. If the
settlement is approved, new rates would be effective on Jan. 1.
The settlement proposes a rate of return of 8.27 percent
and a return on equity of 10.25 percent.
Rocky Mountain, a division of PacifiCorp, originally
proposed a 24.1 percent increase for its largest customer, Monsanto
Corporation, and 14.5 percent increase for Agrium, both based in Soda Springs.
Under the proposed settlement, Monsanto would get a 13.5 percent increase on
Jan. 1, 2008, another 3 percent on Jan. 1, 2009 and 5 percent on Jan. 1, 2010.
Agrium would get a 6.25 percent increase on Jan. 1, 2008, another 3 percent on
Jan. 1, 2009 and another 7 percent on Jan. 1, 2010. The settlement proposes a
75.29 percent increase for street and area lighting and no increase for
commercial customers.
Rates to serve customer classes are based primarily upon
the cost to serve each class. Under the proposed settlement, Rocky Mountain
Power agrees to not increase rates for Monsanto and Agrium beyond what is
proposed even if the cost to serve those classes increases before Dec. 31,
2010. If there are increases in cost of service to Monsanto and Agrium, Rocky
Mountain Power agrees to assume those losses and not propose they be assigned
to other customer classes.
Also under the proposed settlement, irrigators who
participate in the company’s Dispatchable Irrigation Load Control Program will
get nearly twice as large a credit – from the current $11.19 to $23 – for every kilowatt of peak demand reduced. That
can be increased to $26 per kilowatt if total participation reduces more than
150 megawatts of peak demand and $28 if total participation reduces more than
175 MW of peak demand.
The company also agreed to defer consideration of its
proposed changes regarding recovery of collection agency costs, reconnection
fees and line extension changes. The company had proposed requiring that
delinquent customers pay for collection agency fees. Currently the company pays
for collection fees and includes the cost in rates.
Parties participating in the case included Rocky Mountain
Power, commission staff, Monsanto Company, the Idaho Irrigation Pumpers
Association, Agrium, Inc., Community Action Partnership of Idaho and Timothy J.
Shurtz, a Firth resident. Monsanto did not sign the settlement, but will not
oppose it.
The parties state that the settlement represents a
compromise of their positions. The parties agree not to appeal any portion of
the settlement if it is approved. If the commission rejects a portion or all of
the settlement, the parties reserve the right to withdraw within 15 days and be
entitled to seek reconsideration of the commission’s order.
The commission is expected to rule on the proposed
settlement within the next two to three weeks.
Rocky Mountain Power’s application, testimony and workpapers as well as comments and exhibits from intervenors, are available on the commission’s Web site at www.puc.idaho.gov. Click on the electric icon, then on “Open Electric Cases” and scroll down to Case No. PAC-E-07-05.