HomeMy WebLinkAbout20240501IPC to Staff 1-6.pdf "4%6h-0IQAHO POWER.
RECEIVED
Wednesay, May 1, 2024 10:36AM
IDAHO PUBLIC
UTILITIES COMMISSION
MEGAN GOICOECHEA ALLEN
Corporate Counsel
mgoicoecheaal len(aDidahopower.com
May 1, 2024
Monica Barrios-Sanchez, Secretary
Idaho Public Utilities Commission
11331 W. Chinden Boulevard
Building 8, Suite 201-A
Boise, Idaho 83714
Re: Case No. IPC-E-24-15
Idaho Power Company's Application for its Annual Update to Marginal Pricing
Used in Certain Schedules
Dear Ms. Barrios-Sanchez:
Attached for electronic filing, please find Idaho Power Company's Response to the
Frist Production Request of the Commission Staff in the above-entitled matter.
If you have any questions about the attached documents, please do not hesitate
to contact me.
Sincerely,^, IG IAUXVNI.
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Megan Goicoechea Allen
MGA:sg
Attachments
1221 W. Idaho St(83702)
P.O. Box 70
Boise, ID 83707
MEGAN GOICOECHEA ALLEN (ISB No. 7623)
Idaho Power Company
1221 West Idaho Street (83702)
P.O. Box 70
Boise, Idaho 83707
Telephone: (208) 388-2664
Facsimile: (208) 388-6936
mgoicoecheaallen(a)idahopower.com
Attorney for Idaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )
COMPANY'S APPLICATION FOR ITS ) CASE NO. IPC-E-24-15
ANNUAL UPDATE TO MARGINAL )
PRICING USED IN CERTAIN ) IDAHO POWER COMPANY'S
SCHEDULES ) RESPONSE TO THE FIRST
PRODUCTION REQUEST OF
THE COMMISSION STAFF TO
IDAHO POWER COMPANY
COMES NOW, Idaho Power Company ("Idaho Power" or "Company"), and in
response to the First Production Request of the Commission Staff ("Commission" or
"Staff") dated April 10, 2024, herewith submits the following information:
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
COMMISSION STAFF TO IDAHO POWER COMPANY- 1
REQUEST FOR PRODUCTION NO. 1: The Company proposes to apply the same
marginal cost to both Schedule No. 20 customers and Lamb Weston. Please respond to
the following:
a. Please confirm that the incremental 15 MW used in the "base-plus-15-MW" is
based on Lamb Weston's expected incremental load alone, without considering
potential Schedule No. 20 loads;
b. If confirmed, please explain why Schedule No. 20 customers should use Lamb
Weston's marginal cost, if Schedule No. 20 customers will have their own
additional loads, causing the marginal cost to change; and
c. Please explain whether the Company has received any Schedule No. 20 requests
so far.
RESPONSE TO REQUEST FOR PRODUCTION NO. 1:
a. Yes. The incremental 15 megawatts ("MW") used in the base-plus-15-MW run is
based on Lamb Weston's expected incremental load alone. It does not consider
potential Schedule 20 loads.
b. Consistent with the discussion held with Staff in advance of the Company's filing
in this matter, Idaho Power proposes to apply Lamb Weston's calculated marginal
cost rate to the Schedule 20 tariff effective June 1, 2024, because there are no
customers currently taking service under Schedule 20 and the method aligns with
how rates were most recently updated on January 1, 2024, as a result of the
Company's most recently approved general rate case (IPC-E-23-11). As
discussed on page 8 of the Company's Application, Idaho Power plans to further
investigate its methodology for calculating marginal cost rates for current and
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
COMMISSION STAFF TO IDAHO POWER COMPANY- 2
future customers and will engage with Staff to determine the best method(s) going
forward.
c. While the Company has received requests from prospective customers that would
qualify for Schedule 20, none of these projects have moved forward to fund
interconnection upgrades to the point of commencing operations. As a result, no
customers are currently taking service under Schedule 20.
The response to this Request is sponsored by Jessi Brady, Senior
Regulatory Analyst, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
COMMISSION STAFF TO IDAHO POWER COMPANY- 3
REQUEST FOR PRODUCTION NO. 2: The Company used "expected streamflow
conditions for the April 2024-March 2025 test year" in the model run. Application at 7.
Please define "expected streamflow conditions" and explain how they are determined.
RESPONSE TO REQUEST FOR PRODUCTION NO. 2: "Expected streamflow
conditions" is Idaho Power's hydrogeneration forecast for the April 2024 — March 2025
test year. Generally speaking, the hydrogeneration forecast is estimated using the Hells
Canyon Complex Planning Model, which is an object-oriented, multi-objective river and
reservoir modeling decision support system. The model was run using data derived from
the Idaho Power long term streamflow forecast published on February 20, 2024. This
forecast projected April through July inflows into Brownlee of 4.6 million acre-feet ("MAF").
The response to this Request is sponsored by Jessi Brady, Senior Regulatory
Analyst, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
COMMISSION STAFF TO IDAHO POWER COMPANY-4
REQUEST FOR PRODUCTION NO. 3: The Company used "expected load for the
test year." Application at 4. Please respond to the following.
a. Please define "expected load for the test year";
b. Please explain how "expected load for the test year" is determined; and
c. If the "expected load for the test year" is not the 50th percentile load, please explain
why the 50th percentile load is not used.
RESPONSE TO REQUEST FOR PRODUCTION NO. 3:
a. Expected load for the test year is the hourly system 50th percentile energy and 50th
percentile peak forecast for the April 2024 — March 2025 time period.
b. The forecast is developed using unique models for different customer groups. The
models and sources of data used are slightly different depending on the
homogeneity or other characteristics of the group. The forecast for residential,
irrigation, and some commercial categories assume normal weather conditions
while non-weather sensitive load such as the industrial group relies primarily on
the regression analysis. The forecasts for each customer group are aggregated
and then shaped using historic hourly load profiles. The forecasting methodology
is the same methodology used for other filings like the Power Cost Adjustment
("PCA") and Fixed Cost Adjustment ("FCA").
c. Please see the Company's response to Part A.
The response to this Request is sponsored by Jessi Brady, Senior Regulatory
Analyst, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
COMMISSION STAFF TO IDAHO POWER COMPANY- 5
REQUEST FOR PRODUCTION NO. 4: Please explain how the annual marginal
cost of energy for Lamb Weston ($0.046891/kWh) is calculated and provide the
workpaper for the calculation with formula intact.
RESPONSE TO REQUEST FOR PRODUCTION NO. 4: The method used to
calculate the marginal cost of energy is as follows:
1. Determine base case net power supply expenses by simulating the hourly
operations of the Company's power supply system in AURORA over expected
streamflow conditions and expected system loads for the April 2024 — March 2025
period.
2. Run the AURORA simulation a second time with 15 MW added to each hour.
3. Calculate the difference in power supply expenses between the base run and the
base-plus-15-MW run and divide by the difference in megawatt-hours ("MWh").
This is the annual average marginal cost of energy.
Please see "Response to Staff Request No. 5 - Attachment 1" for the workpaper
with calculations intact.
The response to this Request is sponsored by Jessi Brady, Senior Regulatory
Analyst, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
COMMISSION STAFF TO IDAHO POWER COMPANY- 6
REQUEST FOR PRODUCTION NO. 5: In reference to Attachment No. 3 of the
Application (Marginal Costs), please explain how the values in Table "Updated Marginal
Cost of Energy for Schedule 20" are calculated and provide workpapers for the calculation
with formula intact. In addition, please describe the relationship between the values in
Table "Updated Marginal Cost of Energy for Schedule 20" and the proposed rates in
Schedule No. 20.
RESPONSE TO REQUEST FOR PRODUCTION NO. 5: The table "Updated
Marginal Cost of Energy for Schedule 20" in Attachment No. 3 to the Application reflects
the average marginal cost of energy (as described in Response to Request for Production
No. 4) during the respective season and time-of-use period in dollars per MWh and cents
per kilowatt-hour ("kWh"). See "Response to Staff Request No. 5 - Attachment 1" for the
calculation with formula intact.
Please see the Response to Request for Production No. 6 for a description of the
relationship between the marginal cost of energy values in Attachment No. 3 to the
Application and the proposed rates in Schedule 20.
The response to this Request is sponsored by Mary Alice Taylor, Regulatory
Analyst, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
COMMISSION STAFF TO IDAHO POWER COMPANY- 7
REQUEST FOR PRODUCTION NO. 6: Please explain after the two model runs
(with and without the incremental 15 MW) how the modeled results are used to establish
rates for Large General Service for both Primary and Transmission Service, as well as
rates for Large Power Service for both Primary and Transmission Service. In support of
the answer, please provide workpapers that calculate the proposed rates for each
category with formula intact.
RESPONSE TO REQUEST FOR PRODUCTION NO. 6: Please see the file
labeled "Response to Staff Request No. 6 —Attachment 1" for the workpaper to calculate
the proposed rates for Schedule 20. The method for calculating the Schedule 20 rates is
consistent with how rates were developed in the Company's 2023 general rate case
(Case No. IPC-E-23-11). The derivation of Schedule 20 rates for Large General Service
and Large Power Service takes the respective retail energy rate for Schedule 9 and
Schedule 19, respectively, and subtracts the embedded energy rate (as approved in Case
No. IPC-E-23-11) and adds the respective marginal cost of energy as calculated and
described in Response to Request for Production No. 5.
The response to this Request is sponsored by Mary Alice Taylor, Regulatory
Analyst, Idaho Power Company.
DATED at Boise, Idaho, this 1st day of May 2024.
MEGAN G ICOECHEA ALLEN
Attorney for Idaho Power Company
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
COMMISSION STAFF TO IDAHO POWER COMPANY- 8
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 1st day of May, 2024, 1 served a true and correct
copy of Idaho Power Company's Response to the First Production Request of the
Commission Staff upon the following named parties by the method indicated below, and
addressed to the following:
Commission Staff Hand Delivered
Chris Burdin U.S. Mail
Deputy Attorney General Overnight Mail
Idaho Public Utilities Commission FAX
11331 W. Chinden Blvd., Bldg No. 8 FTP Site
Suite 201-A (83714) X Email Chris.Burdin(cr puc.idaho.gov
PO Box 83720
Boise, ID 83720-0074
Stacy Gust, Regulatory Administrative
Assistant
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
COMMISSION STAFF TO IDAHO POWER COMPANY- 9
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-24-15
IDAHO POWER COMPANY
REQUEST NO. 5
ATTACHMENT NO. 1
SEE ATTACHED SPREADSHEET
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-24-15
IDAHO POWER COMPANY
REQUEST NO. 6
ATTACHMENT NO. 1
SEE ATTACHED SPREADSHEET