ORDER NO. 96-151

ENTERED JUN 7 1996

THIS IS AN ELECTRONIC COPY

BEFORE THE PUBLIC UTILITY COMMISSION

OF OREGON

UE 97

DISPOSITION: SPECIAL CONTRACT RATES ALLOWED INTO EFFECT WITH CONDITIONS

At its April 30, 1996, public meeting, the Commission declined to allow Pacific Power & Light Company’s (Pacific) proposed special contract with Oregon Metallurgical Corporation (Oremet) to go into effect and suspended the effective date of Advice No. 96-155 for a period of time not to exceed six months from April 30, 1996. Order No. 96-116.

The Commission expressed two concerns about the proposed contract. The first was the proposed rate is not high enough to ensure that other customers will benefit from the provision of service to Oremet. The second concern was that there is a potential conflict between approval of the contract with Oremet and opposition to the DSI transmission contracts in the State’s Ninth Circuit brief. That is, it would not be appropriate to approve a contract that responds to a retail wheeling alternative created by transmission contracts that the State opposes.

On May 3, 1996, Pacific responded in writing and requested Commission reconsideration and approval of the special contract rates effective with meter readings on and after April 30, 1996. In a letter dated May 13, 1996, Oremet stated that it was not attempting to exercise any retail wheeling option it might have.

At its public meeting on May 14, 1996, the Commission again stated its concern that the proposed rate does not provide sufficient margins above the avoidable cost of serving Oremet. The Commission concluded that the proposed special contract should be allowed to go into effect only until June 30, 1996. Extending the discounted rate until that time should allow the parties enough time to explore other contract terms, without disadvantaging Oremet.

ORDER

IT IS ORDERED that the Power Supply Agreement between Pacific Power & Light Company and Oregon Metallurgical Corporation is allowed to be effective, subject to the following conditions:

The proposed special rates for Oregon Metallurgical Corporation become effective with meter readings on and after April 30, 1996, and shall not extend beyond meter readings on June 30, 1996.

 

Prior to June 30, 1996, Pacific shall inform the Commission of its intent to withdraw the contract dated March 29, 1996; to replace it with another newly negotiated contract with Oremet, or request continuation of the proceeding to further investigate the original filing of the contract, Advice No. 96-155.

 

Made, entered, and effective _______________________________.

A party may request rehearing or reconsideration of this order pursuant to ORS 756.561. A request for rehearing or reconsideration must be filed with the Commission within 60 days of the date of this order. The request must comply with the requirements of OAR 860-014-0095. A copy of any such request must also be served on each party to the proceeding as provided by OAR 860-013-0070. A party may appeal this order to a court pursuant to ORS 756.580.