Idaho Public Utilities Commission
Case No. PAC-E-12-03, Order No. 32507
April 2, 2012
Contact: Gene Fadness (208) 334-0339, 890-2712
Rocky Mountain annual ECAM is not an increase for most customers
For the first time since its inception three years ago, the annual Energy Cost Adjustment Mechanism (ECAM) will not result in an increase for most Rocky Mountain Power customers.
The ECAM covers power supply expenses not already included in base rates that cannot be predicted from year to year. For the third straight year, Rocky Mountain Power claimed it is not collecting enough to cover its power supply expenses but did not seek an increase from most customers because it believes power supply costs will decrease significantly next year. It recommended that the current ECAM rate be held constant to achieve rate stability over the next two years.
However, the utility, which serves 70,000 customers in eastern Idaho, did receive commission authority to collect $2.6 million in power supply expense from its two large-contract customers, Monsanto and Agrium. The total amount to be collected from Monsanto and Agrium for the ECAM account is $7.7 million, but collection of that amount is being spread over three years according to a settlement agreement in the company’s 2011 rate case.
Most power supply expense is included in base rates, but because those costs vary from year to year due to changes in market rates, transportation expense and expiration of contracts with energy suppliers, the ECAM allows the company to make a one-year adjustment every April 1. The adjustment is a one-year increase to customers if power supply costs are higher than the amount already included in base rates and a one-year credit to customers if power supply costs are lower than the amount included in base rates.
In 2010, the ECAM was a 1.3 percent increase and in 2011, it was a 5.8 percent increase. The ECAM appears as a line item on customer bills under the company’s tariff Schedule 94. Rocky Mountain Power’s earnings are not impacted by the ECAM because all the money collected in Schedule 94 is kept in a deferred account that is audited by the commission and must go directly to pay power supply expense. It cannot be used for any other purpose.
A copy of the commission’s order adopting Rocky Mountain Power’s ECAM, along with other documents related to the case, is available on the commission’s Website at www.puc.idaho.gov. Click on the electric icon, then on “Open Electric Cases,” and scroll down to Case No. PAC-E-12-03.