Date:  December 9, 2000

Item Numbers: 2A and 2B

Docket:  2A.  UE-001923, Avista Corporation, dba Avista Utilities
Less than statutory notice request to encourage a reduction in electric power 
consumption during periods of extraordinarily high wholesale power costs or 
energy shortages. 

2B.  UE-001841, Puget Sound Energy
Proposes a comprehensive revision of the Company's existing Schedule 93 -- 
Voluntary Interruption of Electric Service.

Staff:  Fred Ottavelli, acting Electricity Industry Coordinator
  Hank McIntosh, Regulatory Consultant
  Alan Buckley, Senior Policy Analyst
  Thomas Schooley, Policy Research Specialist
  Joelle Steward, Policy Research Specialist

Background

On November 22, 2000, Puget Sound Energy (PSE) filed a revision to Schedule 93, 
Voluntary Interruption of Service.  It allows customers who can curtail at 
least 500 kW an opportunity to earn credits on their electric bills by 
voluntarily curtailing their energy usage.  The service is available to 
customers on schedules 49, 31, 26, 10, and 12.  These customers are firm, high 
voltage or primary general service customers.  Staff and PSE representatives 
met December 5, 2000, to discuss the filing.  This filing is characterized by a 
sharing of cost savings.

On December 8, 2000, Avista Utilities (Avista) filed a tariff revision to 
Schedule 70, Rules and Regulations, requesting less than statutory notice 
(LSN).  The revision describes a voluntary buy-back of customer power based on 
curtailment agreements for a minimum of one megawatt hour.  Staff and Avista 
representatives have held telephone consultations to discuss the filing.  
Credit of up to 70% of wholesale price ( Company anticipates 50 %) with a 
minimum of $200/mWh.

Discussion

Staff have similar initial reactions for both filings; they appear primarily to 
be economic tools but they may help conserve energy in times of system resource 
constraints.  Staff have submitted data requests to PSE and PSE has committed 
to work with Staff in an expedited manner.  We have received responses to some 
of the data requests.  The remaining responses are expected to be fulfilled in 
the next week.  Sufficient time was not available for a data request process 
for the Avista filing.

     
Recent severe weather forecasts, however, suggest that immediate implementation 
of the proposals, on a temporary basis, could be beneficial.  

Staff believe that sunset dates and monthly reporting requirements for each 
company are improvements to these tariff revisions.  These features will 
provide future opportunity to evaluate responses, payments, effectiveness, 
policy implications of economic and managerial options, and their relationship 
with other tools to conserve energy in times of anticipated deficiency of 
resources.   Staff requests the Commission order monthly reports including an 
initial report of the first event.
Recommendation

Staff recommend that the Avista tariff revision in docket UE-001923, be 
permitted to become effective as filed with less than statutory notice on 
December 10, 2000.

Staff recommend that the PSE tariff revision in docket UE-001841, be permitted 
to become effective as filed, if implementation issues can be resolved, with 
less than statutory notice on December 10, 2000.

Although these programs may have merit as supporting the public interest, at 
this time, no determination can or should be made as to the prudence, fairness, 
or reasonableness of these tariff revisions.