ALJ/GK1/jt2 Date of Issuance 5/8/2017 BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF Order Instituting Investigation to determine whether PacifiCorp (U901E) engages in leastcost planning on a control area basis and whether PacifiCorp’s InterJurisdictional Cost Allocation Protocol results in just and reasonable rates in California. FILED PUBLIC UTILITIES COMMISSION APRIL 27, 2017 SAN FRANCISCO, CALIFORNIA INVESTIGATION 17-04-019 ORDER INSTITUTING INVESTIGATION
proposed cost and revenue allocation methodology to the Commission. ORA expressed concern that rate reductions that PacifiCorp promised to Utah ratepayers should not be subsidized with savings and benefits that are more properly assigned to other jurisdictions such as California. The Commission approved the merger, prohibited PacifiCorp from requesting an increase in overall average rates for 1988 through 1991, and required PacifiCorp to convene an Allocation Committee to determine a fair allocation among the various jurisdictions. Subsequent Acquisitions The Commission authorized ScottishPower to acquire PacifiCorp in D.9906049. At the time, PacifiCorp’s California service territory represented 3.3 percent of PacifiCorp’s retail customers and 2 percent of retail electricity sales systemwide. PacifiCorp was subsequently acquired by MidAmerican Energy Holdings Company, authorized in D.0602033, and PacifiCorp is presently an indirect wholly owned subsidiary of Berkshire Hathaway Energy. General Rate Cases and InterJurisdictional Cost Allocation Since the 1988 merger between PacifiCorp and Utah Power, PacifiCorp appears to have filed applications for only two general rate cases (GRC) – for the 2007 and 2011 test years. In neither case did the Commission evaluate the reasonableness of how PacifiCorp allocates costs and revenues among the six states in which it operates. 2007 GRC The Commission approved PacifiCorp’s 2007 test year GRC in D.0612011 by adopting an unopposed settlement between PacifiCorp and ORA. That decision adopted a revenue allocation and rate design settlement and authorized
This Order Instituting Investigation preliminarily determines that hearings will be needed. The Executive Director shall cause this Order Instituting Investigation to be served on the following service lists: Application 0911015, In the Matter of the Application of PacifiCorp (U901E) an Oregon Company, for an Order Authorizing a General Rate Increase Effective January 1, 2011. Application 1003015, In the Matter of the Application of PacifiCorp (U901E), an Oregon Company, for an Order Authorizing a Rate Increase Effective January 1, 2011 and Granting Conditional Authorization to Transfer Assets, pursuant to the Klamath Hydroelectric Settlement Agreement. Application 1502001 et al., In the Matter of the Application of Southwest Gas Corporation (U905G) for Approval of Low-Income Programs and Budgets for Program Years 2015-2017. Application 1507005 et al., In the Matter of the Application of PacifiCorp (U901E) Setting Forth its Distribution Resource Plan Pursuant to Public Utilities Code Section 769. Application 1509007, In the Matter of the Application of PACIFICORP (U901E) for Authority to Sell Certain Mining Assets in Accordance with Public Utilities Code Section 851. Application 1511005, Application of PACIFICORP (U901E), an Oregon Company, for a Permit to Construct the Lassen Substation Project Pursuant to General Order 131D. Application 1608001, In the Matter of the Application of PacifiCorp (U901E) for Approval of its 2017 Energy Cost Adjustment Clause and Greenhouse GasRelated Forecast and Reconciliation of Costs and Revenue. Ex Parte communications in this investigation are governed by Public Utilities Code Section 1701.1 et seq. and Article 8 of the Commission’s Rules of Practice and Procedure. Communications with the assigned Administrative Law Judge shall occur either through formal filing or via email written to the entire service list in this proceeding.