ORDER NO. 99-416
ENTERED JUL 07 1999
This is an electronic copy. Appendices and Footnotes may not appear.
BEFORE THE PUBLIC UTILITY COMMISSION
OF OREGON
UP 162
| In the Matter of the Application for Approval of the Sale of Distribution Transformers to Consolidated Metco, Inc. | ) ) ORDER |
DISPOSITION: APPLICATION GRANTED
On May 13, 1999, the Commission received an application from Portland General Electric Company (the Company), filed pursuant to ORS 757.480 and OAR 860-027-0025, requesting approval to sell certain of its utility property alleged to be no longer necessary or useful for providing utility services to the public. The property consists of four transformers, which were purchased in 1974, 1975, 1977, and 1998, to rent to Consolidated Metco, Inc.
Based on a review of the application and the Commission’s records, the Commission finds that the application satisfies applicable statutes and administrative rules. At its Public Meeting on June 22, 1999, the Commission adopted the Staff’s recommendation to approve the sale as proposed. Staff’s recommendation is attached as Appendix A and is incorporated by reference.
OPINION
Jurisdiction
ORS 757.005 defines a public utility as anyone providing heat, light, water, or power service to the public in Oregon. The Company is a public utility subject to the Commission’s jurisdiction.
Applicable Law
ORS 757.480 provides that a public utility doing business in Oregon shall first obtain Commission approval for any transaction to sell, lease, assign or otherwise dispose of property of such public utility necessary or useful in the performance of its duties to the public or any part thereof of a value in excess of $10,000.
OAR 860-027-0025 specifies the information a public utility must submit when it makes application to sell or lease its property. This application contains the necessary information.
The proposed sale involves property which has a value in excess of $10,000 and is no longer useful for providing utility services to the public. Commission approval of the accounting treatment for this transaction does not constitute approval for ratemaking purposes. There is no indication that the proposed sale will impair the Company’s ability to provide public utility service in Oregon.
CONCLUSIONS
The Company is a public utility subject to the jurisdiction of the Public Utility Commission of Oregon.
The Company’s proposed transaction meets the requirements of ORS 757.480.
The application should be granted.
ORDER
IT IS ORDERED that the application of Portland General Electric Company for authority to sell certain utility property alleged to be no longer necessary or useful for providing utility services to the public in Oregon is granted, subject to the conditions stated in Appendix A.
Made, entered, and effective .
| BY THE COMMISSION: ______________________________ Vikie Bailey-Goggins Commission Secretary |
A party may request rehearing or reconsideration of this order pursuant to ORS 756.561. A party may appeal this order pursuant to ORS 756.580.
Appendix A
ITEM NO. CA 12
PUBLIC UTILITY COMMISSION OF OREGON
STAFF REPORT
PUBLIC MEETING DATE: June 22, 1999
REGULAR AGENDA CONSENT AGENDA X EFFECTIVE DATE_________
DATE: June 4, 1999
TO: Bill Warren through Lee Sparling and Ed Busch
FROM: Ed Krantz
SUBJECT: UP 162, Portland General Electric Company Application for Approval of the Sale of Distribution Transformers to Consolidated Metco, Inc.
SUMMARY RECOMMENDATION:
Approve sale as proposed.
DISCUSSION:
Portland General Electric Company (PGE or Company) filed this application under ORS 757.480 and OAR 860-27-025 asking for approval by the Public Utility Commission (Commission) of the sale of certain PGE utility property alleged to be no longer necessary or useful for providing utility services to the public.
The property consists of four transformers, which were purchased by PGE in 1974, 1975, 1977 and 1998, to rent to Consolidated Metco. As a primary delivery voltage customer, they have decided to own and maintain the transformers rather than rent the transformers from PGE.
PGE is seeking Commission approval of the sale of the transformers to Consolidated Metco, Inc. All of the property proposed for sale has been treated as utility property since purchased.
The property is being sold to the Consolidated Metco, Inc. for $23,869. For valuation purposes, the replacement cost of the installed transformers less the accumulated depreciation was used to calculate the sales price.
There is no indication that the proposed sale will impair PGE’s ability to provide public utility service in Oregon.
PGE proposes to record the $5,688 gain in FERC Account 108, Accumulated Provision for Depreciation of Electric Utility Plant. Use of the depreciation reserve account to record the gain is in accordance with the FERC Uniform System of Accounts.
STAFF RECOMMENDATION:
Staff recommends the application be approved subject to the following conditions:
1. PGE shall file, as soon as available, final executed or conformed copies of all documents related to this transaction.
2. PGE shall file, as soon as available, copies of the journal entries recording the transaction.
The order should note that approval of the accounting treatment does not constitute approval for ratemaking purposes.
ATTACHMENT
SYSTEM-WIDE CONSERVATION PROGRAMS
Idaho Power Company
Description
All Idaho Power Company system-wide conservation programs approved by the Oregon Commission include incentive payments, brochures and advertising expenses describing the system-wide programs, time and expenses of Idaho Power employees, and program development, evaluation, and general administrative costs.
Reasons for Deferral
Adoption of this deferred account is authorized by ORS 757.259(2)(d) and OAR 860-27-300 in order to minimize the frequency of rate changes or the fluctuation of rate levels.
Proposed Accounting
The proposed account for recording the system-wide conservation cost deferrals is FERC Account 182.3, Other Regulatory Assets.
Estimated New Deferrals in Next Authorization Period
The Oregon allocation, based on the energy allocator of 4.1 percent, is $311,600.
Reasons to Continue Deferred Accounting
Continued deferral will allow the Company to comply with Order 89-1700 which authorized Idaho Power to follow standards adopted by the Idaho Public Utilities Commission. The Idaho Commission allows Idaho Power to defer its conservation program costs, including amortization and carrying costs, until they are included in rates.