20240903Reply Comments.pdf

1221 W. Idaho St (83702)
P.O. Box 70
Boise, ID 83707
LISA D. NORDSTROM
Lead Counsel
[e-mail]
September 3, 2024
Commission Secretary
Idaho Public Utilities Commission
11331 W. Chinden Boulevard
Building 8, Suite 201-A
Boise, Idaho 83714
Re: Case No. IPC-E-24-14
Idaho Power Company’s Application for an Order Authorizing Inclusion in the
Bridger Balancing Account of all Non-Fuel Operations and Maintenance
Expenses Associated with Plant Operations.
Dear Commission Secretary:
Attached for electronic filing, please find Idaho Power Company’s Reply
Comments in the above-entitled matter.
If you have any questions about the attached document, please do not hesitate to
contact me.
Sincerely,
Lisa D. Nordstrom
LDN:sg
Attachment
RECEIVED
Tuesday, September 3, 2024
IDAHO PUBLIC
UTILITIES COMMISSION
IDAHO POWER COMPANY’S REPLY COMMENTS - 1
LISA D. NORDSTROM (ISB No. 5733)
Idaho Power Company
1221 West Idaho Street (83702)
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: [phone]
[e-mail]
Attorney for Idaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER
COMPANY’S APPLICATION FOR AN
ORDER AUTHORIZING INCLUSION IN
THE BRIDGER BALANCING ACCOUNT
OF ALL NON-FUEL OPERATIONS AND
MAINTENANCE EXPENSES ASSOCIATED
WITH PLANT OPERATIONS.
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CASE NO. IPC-E-24-14
IDAHO POWER COMPANY’S
REPLY COMMENT
COMES NOW, Idaho Power Company (“Idaho Power” or “Company”), and,
pursuant to Idaho Public Utilities Commission’s (“Commission”) Rule of Procedure1 203
and the Notice of Modified Procedure, Order No. 36220, hereby respectfully submits the
following Reply Comments in response to Comments filed by Commission Staff (“Staff”)
on August 20, 2024, and public comments filed by Sierra Club on May 13, 2024.
1 Hereinafter cited as RP.
IDAHO POWER COMPANY’S REPLY COMMENTS - 2
I. BACKGROUND
The Jim Bridger Power Plant (“Bridger”) plant, located near Rock Springs,
Wyoming, consists of four generating units. PacifiCorp has two-thirds ownership and is
the operator of the facility and Idaho Power owns one-third of Bridger, or 706 megawatts
(“MW”) of net dependable capacity.
With Order No. 35423 in Case No. IPC-E-21-17, the Commission approved Idaho
Power’s request to establish a Bridger balancing account mechanism that is designed to
smooth revenue requirement impacts associated with the cessation of coal-fired
operations at Bridger and allow for full recovery of Bridger coal-related costs by December
31, 2030. The levelized revenue requirement includes the costs of accelerating the
depreciation of the Bridger coal-related plant items, the return associated with coal-
related capital investments net of accumulated depreciation forecasted through Idaho
Power’s participation in operations of Bridger, a small portion of decommissioning costs
associated with the then-assumed Bridger end-of-life, and operations and maintenance
(“O&M”) associated with coal-fired non-fuel O&M reductions.
Due to economic and regulatory factors, Idaho Power analyzed the conversion of
Bridger units to natural gas commencing with the 2021 Integrated Resource Plan (“IRP”).
The Company’s resulting 2021 Preferred Portfolio, acknowledged with Order No. 35603,
included the conversion of Units 1 and 2 from coal to natural gas by the summer of 2024,
and the exit of coal-fired operations in Units 3 and 4 by year-end 2025 and 2027,
respectively. Further, the 2023 IRP, filed in Case No. IPC-E-23-23, again identified the
conversion of Units 1 and 2 from coal to natural gas by the summer of 2024.
IDAHO POWER COMPANY’S REPLY COMMENTS - 3
Given the conversion of Bridger from coal to gas indicated through the IRP
analyses, Idaho Power filed the current Application with the Commission on March 29,
2024, requesting that the Commission issue an order authorizing the inclusion in the
Bridger balancing account of all non-fuel O&M expenses associated with plant operations,
as these costs are not considered under the current Bridger revenue requirement
mechanism, but are required for the ongoing safe, reliable operation of the plant.
On May 13, 2024, public comments were filed by Sierra Club. In its comments,
Sierra Club recommended that the Commission deny Idaho Power’s request in this case,
citing concerns related to the commingling of gas-related and coal-related costs, and the
difficulty such commingling would present in the future examination of prudence for
expenditures at Bridger.
On August 20, 2024, Staff filed comments recommending the Commission
approve the Company’s Application, specifically recommending the Commission: 1)
recognize the Company’s decision to convert Bridger Units 1 and 2 from coal to natural
gas as prudent, but prudence of actual cost will be determined in a future rate case before
being included in rates; and 2) approve the Company’s accounting methods proposed for
all non-fuel O&M expenses in the Bridger Balancing Account.
In these Reply Comments, Idaho Power discusses its concurrence with Staff’s
conclusion, and demonstrates the Sierra Club’s assertions are inaccurate and unfounded.
II. REPLY COMMENTS
Idaho Power appreciates Staff’s full and thorough review of its Application, and
concurs with Staff’s conclusion that the Company’s Application should be approved.
Further, the Company appreciates Staff’s review of the proposed accounting, and the
IDAHO POWER COMPANY’S REPLY COMMENTS - 4
conclusion that all non-fuel O&M should appropriately be tracked through the Bridger
mechanism, and that Account 502, Steam expenses, is the appropriate account in which
to record these expenses.
Idaho Power disagrees with Sierra Club’s assertion that the Company’s Application
should be rejected, which appears to be based on a number of misunderstandings with
regard to the Company’s request in this case. Sierra Club states that the commingling of
coal and gas expenses would “frustrate” future prudence reviews, and with the conversion
of Units 1 and 2 “Jim Bridger has, for all intents and purposes, been split into two separate
plants…” Sierra Club goes on to conclude that “by commingling costs associated with
both the gas and coal units into a single balancing account, Idaho Power would make it
impossible to distinguish between costs incurred on behalf of the coal units from costs
incurred on behalf of the gas units.”
This is simply untrue, misstates how costs are incurred and recorded at the facility,
and confuses the Company’s relatively narrow request to track non-fuel O&M with the
tracking and recovery of capital-related costs (which are not at issue in this case). To be
clear, the Company is not requesting prudence for any non-fuel O&M, fuel, or capital
expenditures in this case, and a Commission order approving the Company’s Application
would have no negative impact on the ability to perform a prudence review of
expenditures at the facility in a future rate filing. Idaho Power’s request in this case is
simply to include all non-fuel O&M in the Bridger mechanism. The operation of all four
units requires non-fuel O&M expenditures to ensure the plant can be operated in a safe,
reliable manner, and the conversion of two units to natural gas does not change that fact.
Differences resulting from the gas conversions related to capital expenditures and fuel
IDAHO POWER COMPANY’S REPLY COMMENTS - 5
costs will be separately tracked between gas-related and coal-related costs, and will be
subject to prudence review by the Commission and intervening parties in a future filing.
Any differences between coal and gas cited by Sierra Club, such as fuel costs and
different capital expenditures required by competing environmental regulations, will be
separately tracked and available for review by the Commission, Staff, and stakeholders
in a future rate proceeding. Therefore, the concerns cited by Sierra Club are entirely
unfounded and ignore how Bridger costs will actually be recorded.
III. CONCLUSION
Idaho Power acknowledges and appreciates Staff’s review of the Company’s
Application and respectfully requests the Commission issue an order authorizing the
inclusion in the Bridger balancing account of all non-fuel O&M expenses associated with
plant operations. Contrary to the assertions made by Sierra Club, the Company’s request
in this case would have no negative impact on the ability of the Commission to perform a
prudence review of Bridger-related expenditures in a future proceeding.
DATED at Boise, Idaho this 3rd day of September 2024.

LISA D. NORDSTROM
Attorney for Idaho Power Company
IDAHO POWER COMPANY’S REPLY COMMENTS - 6
CERTIFICATE OF SERVICE

I HEREBY CERTIFY that on the 3rd day of September 2024, I served a true and
correct copy of Idaho Power Company’s Reply Comments upon the following named
parties by the method indicated below, and addressed to the following:

Commission Staff
Chris Burdin
Deputy Attorney General
Idaho Public Utilities Commission
11331 W. Chinden Blvd., Bldg No. 8
Suite 201-A (83714)
PO Box 83720
Boise, ID 83720-0074

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Sierra Club
Rose Monahan
Staff Attorney
Sierra Club
2101 Webster Street, Suite 1300
Oakland, CA 94612

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Lisa Young
Idaho Chapter Director
Sierra Club
910 W Main Street #208
Boise, ID 83702
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Stacy Gust
Regulatory Administrative Assistant