20240726Response to Interlocutory Order Questions.pdf

RECEIVED
Friday, July 26, 2024
IDAHO PUBLIC
UTILITIES COMMISSION
_ ROCKY MOUNTAIN 1407 W.North Temple,Suite 330
POWER. Salt Lake City,UT 84116
A DIVISION OF PACIFICORP
July 26, 2024
VIA ELECTRONIC DELIVERY
Commission Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd
Building 8 Suite 201A
Boise, ID 83714
RE: CASE NO. PAC-E-24-05
IN THE MATTER OF THE APPLICATION OF ROCKY MOUNTAIN POWER
REQUESTING APPROVAL OF $62.4 MILLON ECAM DEFERRAL
Attention: Commission Secretary
Please find Rocky Mountain Power's response to the questions as requested by Commission
Interlocutory Order No. 36274 in the above referenced matter. Sections of the response and the
supporting workpapers are confidential and are being sent via an encrypted file. You will receive
a separate email with access to these files.
Informal inquiries may be directed to Mark Alder, Idaho Regulatory Manager at(801) 220-2313.
Very truly yours,
0.�
Joe teward
Senior Vice President, Regulation

Joe Dallas (ISB# 10330)
PacifiCorp, Senior Attorney
825 NE Multnomah Street, Suite 2000
Portland, OR 97232
Email:joseph.dallaskpacificorp.com
Attorney for Rocky Mountain Power
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF ROCKY ) CASE NO. PAC-E-24-05
MOUNTAIN POWER'S ) ROCKY MOUNTAIN POWER'S
APPLICATION FOR APPROVAL OF ) RESPONSE TO INTERLOCUTORY
$62.4 MILLON ECAM DEFERRAL ) ORDER QUESTIONS
Pursuant to Rule 202.01(d) of the Rules of Procedure of the Idaho Public Utilities
Commission ("Commission") and the Commission's July 19, 2024, Interlocutory Order, Rocky
Mountain Power a division of PacifiCorp (the "Company") hereby submits its response to the
Interlocutory Order in the above-referenced case.
I. BACKGROUND
1. On April 1, 2024, the Company applied for Commission authorization to adjust its
rates under the Energy Cost Adjustment Mechanism ("ECAM") and requested approval of
approximately$62.4 million in deferred costs from the deferral period beginning January 1, 2023,
through December 31, 2023,with a 10.5 percent overall increase to Electric Service Schedule No.
94, Energy Cost Adjustment("Schedule 94").
2. On May 31, 2024, the Commission issued Order No. 36207 disallowing
approximately$2.3 million in costs incurred to comply with the Washington Climate Commitment
Act ("WCCA"). On June 21, 2024, the Company filed a Petition for Reconsideration requesting
that the Commission reconsider its decision to disallow WCCA compliance costs. On July 19,
2024, the Commission issued Interlocutory Order No. 36274 requesting the Company respond to
ROCKY MOUNTAIN POWER'S RESPONSE TO
INTERLOCUTORY ORDER QUESTIONS Page 1

eight questions described in the order by June 26, 2024. The Company now presents its response
to the questions as requested in the Interlocutory Order No. 36274.
II. COMPANY RESPONSE TO QUESTIONS
3. The Commission requested a response to the following eight questions:
A. How did the Company calculate the$23.6 million increase in Net Power Cost("NPC")
was determined and whether this increase is for the system or for Idaho? The
Company should provide all workpapers (with formula intact) documenting the
method of calculation,the inputs and the sources of each input, and any assumptions
made.
4. The $23.6 million presented in Jack Painter's direct testimony) and also provided
with this filing as a confidential workpaper titled"CONF_Workpaper Chehalis_Energy.xlsx"is a
counterfactual calculation that shows the energy cost associated with replacing Chehalis'
generation with market purchases, at Mid-Columbia during the 2023 deferral period. The increase
is a system(total-company)value. However,this calculation does not include the cost of replacing
the dispatchable capacity of Chehalis and also does not account for the likelihood that the output
of a 510 MW resource (Chehalis)may not be replaceable in the increasingly energy scarce power
markets. This calculation also reflects the incremental difference in the commodity cost of natural
gas and the power market conditions that existed during calendar year 2023, which may vary in
future years.
B. How the Company proposes to remove both the costs and benefits of Chehalis's
generation from Idaho NPC (the mechanism and the method with workpapers), "if
the Commission will not reconsider the determination regarding situs assignment of
WCCA compliance costs"? Petition at 17.
5. For the NPC impact, the cost/benefit of Chehalis would be calculated as the
cost/benefit of the lost energy plus the cost/benefit of the lost dispatchable capacity, net of the
' Jack Painter direct testimony at 25.
ROCKY MOUNTAIN POWER'S RESPONSE TO
INTERLOCUTORY ORDER QUESTIONS Page 2

REDACTED
revenue requirement impact. If it is determined that the costs and benefits of Chehalis'generation
are to be removed from Idaho NPC, the Company proposes to do so through the ECAM until the
costs and benefits can be removed from base rates through a general rate case. The impact of
removing the non-NPC revenue requirement of Chehalis currently included in Idaho customer
rates is a reduction of$3.2 million and the impact of removing the NPC revenue requirement of
Chehalis is an increase of $7.9 million. Please see attached confidential workpaper titled
"CONF Workpaper_Chehalis_Energy and Capacity.xlsx" for the NPC calculation and the
workpaper titled"Chehalis 2020 ID Non-NPC Rev Req" for the revenue requirement calculation.
C. What is the reason that the actual NPC per megawatt hour for Chehalis generation
included in the ECAM was significantly higher than other combined cycle combustion
turbine natural gas plants of approximately the same size such as Current Creek and
Lake Side I and Lakeside II?
6. There are two main reasons the actual NPC per megawatt hour for Chehalis was
higher than other combined cycle combustion turbine gas plants: (1) Chehalis physically sources
gas from the Sumas gas trading hub which on average was higher than the gas trading hubs that
supplies PacifiCorp East resources; and (2) Washington state has a carbon tax, which is the
variable Cap and Invest GHG allowance cost under discussion.
D. Did the actual cost of Chehalis in the ECAM include the cost of Washington CCA
allowance costs or other adders? If so,what was the cost of the allowances on a dollar
per MWh basis?
7. Yes,the actual cost of Chehalis in the ECAM included the cost of Washington CCA
allowance costs. The weighted average cost of the allowances in the ECAM was
E. What is the yearly projected range of allowance cost on a dollar per MWh basis and
in total for both the system and for Idaho over the remaining life of the plant and
what is the basis used to determine the estimates?
8. Please see Table I below for the projected Chehalis allowance costs:
ROCKY MOUNTAIN POWER'S RESPONSE TO
INTERLOCUTORY ORDER QUESTIONS Page 3

REDACTED
Table 1: Chehalis Projected Allowance Costs
2026 1 2027 1 2028 1 2029 1 2030 1 2031 1 2032 1 2033 1 2034 1 2035 2036 1 2037 1 2038 1 29".52Z&i2MI.L2M
Chehalis Generation(GWh) 2,175 616 160 143 98 95 41 7 13 15 8 6 3 3
WA GHG Allowance Price $/MWh 34.24 36.92 45.77 46.41 49.00 50.69 57.96 59.78 63.64 65.60 66.84 75.79 86.76 87.63
Total Dollars($m) 74.5 22.8 7.3 6.6 4.8 4.8 2.4 0.4 0.8 1.0 0.6 0.5 0.3 0.3
Idaho Allocated Dollars($m) 4.42 1.35 0.43 0.39 0.29 0.29 0.14 0.03 0.05 0.06 0.03 0.03 0.02 0.02
Generation(GWh)obtained from the 2023 IRP update
CO2 Chehalis$/MWh obtained from the 2023 IRP update
For the Idaho allocated amount the SE factor of 5.94%from 2023 was used for all years.
It is important to note that if Washington voters approve Initiative 2217, which is on the
November 5, 2024 ballot, it could materially impact this projection of costs, as it would
effectively repeal the relevant portions of the Washington CCA.2
F. What dispatch cost is the Company currently using to dispatch Chehalis and what is
it based on; does it include the cost of allowances?
9. As of July 22, 2024, the current dispatch cost of Chehalis is - and this
includes fuel cost, plus GHG allowance costs, plus variable operations and maintenance costs.
G. How does the dispatch cost of Chehalis with and without WCCA compliance costs
compare with the Company's other dispatchable resources?
10. Confidential Table 2 below, displays the dispatch costs for Company dispatchable
resources as of July 22, 2024.
2 Washington Initiative Measure No.2217(filed May 30,2023),available at:I-2117.pdf(letseowashington.com).
ROCKY MOUNTAIN POWER'S RESPONSE TO
INTERLOCUTORY ORDER QUESTIONS Page 4

REDACTED
H. If other jurisdictions are charged CCA compliance costs and Washington receives free
allowances,what dispatch cost would the Company use to dispatch the plant and how
would it be determined?
11. Fuel cost, plus GHG allowance costs, plus variable operations and maintenance
costs, etc. This is the current manner by which Chehalis is dispatched.
III. CONFIDENTIAL INFORMATION
12. This filing contains information that is Confidential and/or constitutes Trade
Secrets as defined by Idaho Code Section 74-101, et seq. and 48-801 and protected under IDAPA
31.01.01.067 and 31.01.01.233. Specifically,the Chehalis dispatch costs are Company proprietary
information that could be used to its commercial disadvantage.
ROCKY MOUNTAIN POWER'S RESPONSE TO
INTERLOCUTORY ORDER QUESTIONS Page 5

IV. CONCLUSION
13. The Company hereby submits its response to the questions as requested in the
Commission's interlocutory order.
DATED this 26t'day of July, 2024.
Respectfully submitted,
ROCKY MOUNTAIN POWER
Is/Joe Dallas
Joe Dallas (ISB# 10330)
PacifiCorp, Senior Attorney
825 NE Multnomah Street, Suite 2000
Portland, OR 97232
Email:joseph.dallaskpacificorp.com
Attorney for Rocky Mountain Power
ROCKY MOUNTAIN POWER'S RESPONSE TO
INTERLOCUTORY ORDER QUESTIONS Page 6

CERTIFICATE OF SERVICE
I hereby certify that I have this 261h day of July, 2024, served Rocky Mountain Power's
Response to Interlocutory Order Questions in Case No. PAC-E-24-05,by e-mailing a copy to
the following:
Mark Alder Joe Dallas
Rocky Mountain Power Rocky Mountain Power
1407 West North Temple, Ste. 330 825 NE Multnomah St., Ste. 2000
Salt Lake City, UT 84116 Portland, OR 97232
Email: mark.alder(cr�pacificorp.com Email: joseph.dallaskpacificorp.com
Data Request Response Center
Email: datarequest&pacificorp.com
Adam Triplett Thomas J. Budge
Deputy Attorney General Racine Olson,PLLP
Idaho Public Utilities Commission P.O. Box 1391; 201 E. Center
P.O. Box 83720 Pocatello, ID 83204-1391
Boise, Idaho 83720-0074 Email:tj&racineolson.com
Email: adam.triplett(cr�puc.idaho.gov
Brian C. Collins Ronald L.Williams
Greg Meyer Brandon Helgeson
Brubaker&Associates Hawley Troxell Ennis &Hawley LLP
16690 Swingley Ridge Rd., #140 P.O. Box 1617
Chesterfield, MO 63017 Boise, ID 83701
Email:bcollins&consultbai.com Email: rwilliams&hawleytroxell.com
gmaer(d),consultbai.com bhel eg son(khawleytroxell.com
Bradley Mullins Val Steiner
MW Analytics Itafos Conda, LLC
Teitotie 2, Suite 208 Email: val.steiner(&,itafos.com
Oulunsalo Finland, FI-90460
Email: bnnullinsgmwanal3qics.com Kyle Williams
BYU Idaho
Email: williamsk&byui.edu
Cole Albee
Paralegal
McDowell Rackner Gibson PC