Just wrapped up a fuel cost recovery case with Idaho Power that netted $89,247 for a food processing plant in Boise. The issue was improper allocation of natural gas fuel costs during the 2021 winter storm period when gas prices spiked. Idaho Power was spreading the extraordinary fuel costs across all customers, but their tariff Schedule 19 specifically exempts interruptible customers from fuel cost adjustments during force majeure events. My client had interruptible service but was still getting billed for the fuel adjustment. Anyone else dealt with fuel cost allocation issues during that crazy winter?
Idaho Power fuel cost recovery - $89K win
Pete that's a great catch! MLGW here in Memphis handled the winter storm costs differently - they filed for a separate surcharge that hit everyone equally regardless of service class. The interruptible exemption language is key. Did Idaho Power fight you on the interpretation or acknowledge the error pretty quickly?
Outstanding work Pete! Kentucky Utilities tried similar shenanigans during the winter storm, spreading extraordinary costs to customers who should have been exempt. The fuel adjustment clauses in these tariffs are incredibly complex and utilities bank on customers not understanding them. How long did the dispute take to resolve?
Randy - they fought it initially, claiming force majeure only applied to physical service interruptions, not financial impacts. But the tariff language was pretty clear that interruptible customers are exempt from fuel adjustments during declared emergencies. Oz - took about 8 months total, including a formal complaint with the Idaho PUC. Idaho Power settled right before the hearing date.
Pete, what percentage of the winter storm fuel adjustment were interruptible customers supposed to be exempt from? Alabama Power handled it by creating separate rate riders, but I've heard other utilities just lumped everyone together. Your case shows why reading the fine print matters!
Leon - interruptible customers were supposed to be completely exempt from the extraordinary fuel costs, not just a percentage. The regular fuel adjustment still applied, but the storm-related spike costs should have been borne only by firm service customers. Idaho Power's billing system wasn't sophisticated enough to make that distinction automatically.
Great case study Pete! MLGW is still dealing with winter storm cost recovery issues here in Memphis. The interruptible exemption angle is brilliant - most auditors would focus on the fuel cost calculation itself rather than the allocation methodology. Did you find other interruptible customers with the same issue?