20250617Staff Comments.pdf

RECEIVED
June 17, 2025
JEFFREY R. LOLL IDAHO PUBLIC
DEPUTY ATTORNEY GENERAL UTILITIES COMMISSION
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 11675
Street Address for Express Mail:
11331 W CHINDEN BLVD, BLDG 8, SUITE 201-A
BOISE, ID 83714
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF )
IDAHO POWER COMPANY FOR REVIEW ) CASE NO. IPC-E-25-05
OF THE COMPANY'S CURRENT WILDFIRE )
MITIGATION PLAN AND AUTHORIZATION )
TO DEFER NEWLY IDENTIFIED ) REDACTED COMMENTS OF
INCREMENTAL WILDFIRE MITIGATION ) THE COMMISSION STAFF
COSTS )
COMMISSION STAFF ("STAFF") OF the Idaho Public Utilities Commission
("Commission"), by and through its Attorney of record, Jeffrey R. Loll, Deputy Attorney
General, submits the following comments.
BACKGROUND
On February 13, 2025, Idaho Power Company("Company") filed an application
("Application") with the Commission requesting an order authorizing the Company to defer
newly identified costs associated with the Company's expanded wildfire mitigation efforts, as
detailed in the Company's 2025 Wildfire Mitigation Plan("WMP"). Application at 1.
On March 6, 2025, the Commission issued a Notice of Application and Notice of
Intervention Deadline. Order No. 36494. No party intervened.
STAFF COMMENTS 1 JUNE 17, 2025

STAFF ANALYSIS
Staff reviewed the Company's Application, the 2025 WMP, responses to production
requests, and other supporting documents. Staff recommends the Commission confirm that the
Company is correctly understanding its current authority to defer expenses related to Vegetation
Management, its Covered Wire Pilot Project, and its Satellite Pilot Project as stated in Order No.
36042. Staff recommends the Commission authorize the Company to defer the additional
identified expenses in the Company's Application, except for labor and the standby helicopter
service expenses, without a carrying charge, through 2025 or until the Company's next general
rate case goes into effect.
After reviewing the 2025 WMP, Staff recommends that the Commission order the
Company to include in its WMP (1) a list of all pilot projects, including the current status of the
pilot and an explanation of how the Company is evaluating least-cost, least-risk solutions, (2)
detail how the Company identifies, selects, and evaluate projects as least-cost, least-risk for line
rebuilding, undergrounding, and covered conductor to be consistent with Senate Bill 1183,
effective July 1, 2025, and(3) include a section where it explains how the Company addressed
Staff s recommendations to the WMP and to discuss other high-level major changes/updates to
the WMP since the last filing.
Lastly, Staff recommends the Commission order the Company to complete an internal
audit of its WMP to be included with its next WMP filing with the Commission, consistent with
Order No. 35717.
Current Deferral
As part of a Stipulation and Settlement ("Settlement") approved in Case No. IPC-E-23-
11, the parties agreed that vegetation management and other wildfire expenses included in base
rates would be $26,080,688. Case No. IPC-E-23-11, Stipulation and Settlement at 8.
Additionally, incremental vegetation management costs above the 2022 actuals of$24,848,875
will continue to be deferred through the earlier of the Company's next general rate case or 2025.
Id. Expenses for the Covered Wire Evaluation pilot and the Vegetation Management Satellite
and Aerial Patrols pilot would also be deferred through 2025 or the Company's next general rate
case. Id. The Settlement did not authorize a carrying charge on the deferral.
STAFF COMMENTS 2 JUNE 17, 2025

In 2024, the Company filed a limited scope rate case that excluded most Operations &
Maintenance ("O&M") expenses, including its wildfire mitigation expenses. Application at 14.
The Company does not consider the luuited issue rate case as a general rate case and therefore
believes the Company's deferral would continue until 2025. Id. at 15. With this Application, the
Company is requesting the Commission confirm its assumption and be able to defer vegetation
management and its pilot project expenses through the end of 2025. Id. at 17. Staff believes the
Company is acting in good faith relative to the Settlement and recommends the Comuu.ssion
confirm its current authority. Without this filing, the Company would not have the authority to
defer these expenses in 2025.
Review of the Newly Identified Expenses
The Company identified $23.2 nullion of incremental expenses above those recovered in
base rates. Id. at 8. Table No. 1 below is a summary of each newly identified expense the
Company requests to defer through 2025 or until the Company's next general rate case goes into
effect. Staff discusses its review of each new expense in the sections below.
Table No. 1: Ne-vi-ly Identified Expenses
Quantifying Wildland Fire Risk $ 2,030,000
Dynamic Risk Modeling Tools $ 2,030,000
Situational Awareness $ 907,000
Weather Forecasting-System development and support $ 215,000
Drone Beyond Visual Line of Sight Waiver $ 120,000
Aerial Drone Inspection Pilot Project $ 214,000
Standby Helicopter Service $ 358,000
Wildfire Program&Personnel $ 1,059,000
Wildfire Team Program Labor $ 618,000
Patrolmen for Wildfire Safety Inspections $ 253,000
PSPS and Event Management Support $ 188,000
Vegetation Management $ 19,237,000
Transition to/Maintain 3-year Vegetation Management
Cycle $ 18,522,000
Enhanced Practices for Distribution Red&Yellow Risk
Zones(Pre-Fire Season Patrols/Mitigation,Pole Clearing,
Removals,Work QA) $ 715,000
Forecast New Incremental 0&M Expenditures Total $ 23,233,000
STAFF COMMENTS JUKE 17, 2025

Quantifying Wildland Fire Risk
In 2025, the Company forecasts $2.03 million on new dynamic risk modeling tools. The
Company plans to invest in a new wildfire risk model by Technosylva. See Company's
response to Staff s Production Request No. 12. The Company believes the new tools are more
sophisticated and will provide more granularity to its risk modeling which can inform mitigation
efforts, such as focused vegetation management or infrastructure upgrades. Id. The new system
will be a be able to integrate real-time weather data and infrastructure conditions. Id.
Situational Awareness
As part of its Situational Awareness program, the Company forecasts expenses of
$907,000 in 2025. The Company forecasts $215,000 on system development and support of its
weather forecasting system. This expense is for the use of a contractor to validate the
Company's completed weather modeling system. Application at 10. Weather forecasting is a
critical aspect of the Company's mitigation efforts, which informs standard operating procedures,
and may result in a Public Safety Power Shutoff("PSPS") in an effort to reduce possible
ignitions.
The Company plans to pilot an Aerial Drone Inspection project to explore more
standardized use of drones for line and facility inspections with a forecasted cost of$214,000.
Application at 1. In support of its Aerial Drone Inspection pilot project, the Company is
pursuing two waivers from the Federal Aviation Association for Beyond Visual Line of Sight
with a forecasted cost of$120,000. The first waiver is for the Company to operate a single
unmanned aircraft without requiring a visual observer or pilot to be on site. Company's
Response to Staff's Production Request No. 5. This waiver was expected to be approved by June
1, 2025. Id. After approval of the first waiver, the Company will apply for a second waiver for
remote operations. Id. The Company anticipates approval of the second waiver in October
2025. See Company's Response to Staff's Production Request No. 6. As part of the current
authority, the Company is able to defer expenses for its first two pilots and Staff believes that the
Company should also be able to defer the pilot and waiver expenses until benefits are shown.
In 2024, the Company implemented for the first time a 6-week standby helicopter service
pilot program and contracted the service for 75 hours for any purpose (i.e., patrols and
construction). Company's Response to Staff's Production Request No. 7. The Company stated
STAFF COMMENTS 4 JUNE 17, 2025

that the service was utilized for 17 days,nine days for patrol and eight days for other operational
needs. Id. In 2025, the Company plans to extend the standby helicopter contract to 12 weeks to
provide expanded aerial support for wildfire mitigation, outage response, and overall system
reliability. Id. As part of its Response to Staff's Production Request No. 7, the Company
provided a cost-benefit analysis as a confidential attachment, in which the Company evaluated
(1)maintaining status quo, (2) executing a standby helicopter contract, and(3) acquiring a
company-owned helicopter. The Company's recommended solution was to secure a standby
helicopter contract as it ensured the availability of a helicopter. Id. As stated in the cost-benefit
analysis, if the Company maintained the status quo on
Id. The analysis did not provide what the Company considered as
"limited" activity or provide cost estimates of as-needed helicopter services; therefore, Staff was
not able to verify if there were any savings or extensive costs to warrant a contracted standby
service. If the Company executed a standby helicopter contract,
-However, the contract price was not provided and reduced outage durations were not
quantified within the analysis, so Staff was not able to verify any savings. If the Company
acquired a company-owned helicopter
Staff is concerned that the Company's analysis focused solely on the availability of
helicopters to the Company and did not consider an option to not have helicopters for wildfire
mitigation. The analysis provided did not include sufficient evidence of cost estimates,
comparisons of different contract lengths, or any quantified savings or benefits for ratepayers.
Staff would expect to see cost savings from the use of a helicopter and other benefits such as
reduced outage durations. Therefore, Staff does not believe that there was sufficient justification
for the standby service to support a necessity based on the responses from the Company. Staff
believes ratepayers should not have to pay for any unnecessary expenses. For expenses to be
deferred as a regulatory asset, there should be a reasonable expectation of fixture recovery.
Because Staff is uncertain that the standby helicopter is a prudent expenditure, Staff recommends
the Commission deny the deferral for standby helicopter service expenses.
STAFF COMMENTS 5 JUNE 17, 2025

Wildfire Program &Personnel
The Company forecasts $1.06 million of labor expenses to hire seven new Full Time
Equivalent("FTE")positions in support of the wildfire mitigation program in 2025. Company's
Response to Staff's Production Request No. 1. Four of these FTEs are directly for the wildfire
team program: a Wildfire Initiatives Project Manager, Fire Response and Training Specialist,
Risk Analyst, and a Compliance Specialist. Id. These new roles expand the Company's wildfire
team to a total of eight positions. Id.
Separate from the wildfire mitigation team, the Company plans to hire a fully dedicated
PSPS Event Management Specialist. Application at 12. This role is responsible for developing,
implementing a comprehensive wildfire and PSPS response strategy, and to streamline event
responses. Id. at 13.
Lastly, the Company plans to hire two new Patrol Lineman positions that will conduct
wildfire safety inspections, perform preseason patrols, respond to PSPS events, and support
overall system reliability through routine and emergency inspections. Id. at 12.
Regarding the section on continuing the deferral included expenses only for pilot projects
and incremental vegetation management costs on page 8 of the Settlement in Case No. IPC-E-
23-11, Staff did not intend for this deferral to be as wide sweeping as the Company proposes in
the Application. None of these positions are tied directly to pilot projects or incremental
vegetation management costs. Additionally, deferrals are typically used when expenses are
unexpected or variable. The Company has not shown any of the identified labor expenses are
unexpected or variable in this case. Further, any labor expense increases within the deferral
could be passed on to ratepayers without undergoing the scrutiny that occurs in a general rate
case. Therefore, Staff recommends the Commission deny the labor expenses in the wildfire
deferral and order the Company to seek recovery of labor expenses in a general rate case.
Vegetation Management
The Company forecasts $18.5 million of vegetation management expenses in addition to
those already recovered in base rates. An amount of$715,000 is attributed to enhanced
vegetation management activities such as annual patrols, mid cycle pruning, and hazard tree
remediation.
STAFF COMMENTS 6 JUNE 17, 2025

Additionally, the Company will begin a new internal three-person vegetation
management crew pilot program, which will run through December 2026. Response to Staff s
Production Request No. 8 This new pilot program is forecasted to be $401,000 in 2025. The
Company plans to evaluate the program's effectiveness at the end of 2026. Id. As vegetation
management is the most significant expense of the WMP, Staff is encouraged the Company is
seeking methods to potentially mitigate the vegetation management expenses through internal
crews and recommends these pilot program expenses be deferred until benefits are realized.
The remaining $17.3 million are estimated costs driven by anticipated workload growth
in 2025 and expected rate increases for contracted vegetation management services. Id. The
Company expects an increased workload due to unfinished work from the prior pruning cycle
and expects the additional work to continue into 2026. See Company's Response to Staffs
Production Request No. 17. The Company believes the most effective near-term strategy is to
achieve and maintain a routine pruning cycle with appropriate clearances. Id. The Company
also stated it currently hires nine full-time contractors for pruning, one for work planning and
customer notifications, and three for seasonal support of its vegetation management practices.
Id. The Company provided updated Schedule of Rates and Change Order for Vegetation
Management Services Agreements for its two primary contractors, showing an average 6.7%
increase of hourly labor rates for contractors.
Industry standards range from three to five-year vegetation management cycles. As the
Company is seeing increased demand for contractors for vegetation management across the
West, Staff encourages the Company to continue to seek cost-effective alternatives to mitigate
increased expenses, such as consideration of different vegetation management cycles.
Review of the 2025 WMP
As part of Staff s review of the newly identified expenses, Staff reviewed the Company's
2025 WMP.
Over the five-year plan, Idaho Power forecasts to spend $137.6 million system wide on
capital investments. WMP at 77. The Company forecasts increased capital expenditures as it
invests more into system hardening. This includes the overhead primary hardening program,
strategic undergrounding, investments of recloser segmentation and communication upgrades,
wildfire detections cameras and atmospheric science weather stations. Id.
STAFF COMMENTS 7 JUNE 17, 2025

Over the five-year plan, the Company forecasts $275.3 million in O&M expenses. WMP
at 63. The Company forecasts $51 million in O&M in 2025, including the new expenses
identified in its Application. Id. The majority of the Company's forecasted O&M expenses are
for its 3-year enhanced vegetation management cycle in wildfire risk zones, estimated to be a
total of$211 million over the five year plan. Id at 62. Staff encourages the Company to continue
to seek methods to mitigate the Company's expenses as described above.
Additionally, the Company's Application includes the new internal three-person
vegetation management crew pilot project, which is not clearly identified within the WMP.
Application at 14. To provide clarity of all the Company's pilot projects, Staff recommends the
Commission order the Company to list all pilot projects within the WMP and to include the
current status of the pilot and an explanation of how the Company is evaluating least-cost, least-
risk solutions.
Table No. 2 below is a summary of the forecasted expenses for the Company's five-year WMP
plan.
Table No. 2: Forecasted WMP Expenses (000s)
5 Year
2025 2026 2027 2028 2029 5Year Idaho
Forecast Forecast Forecast Forecast Forecast Total Total
Capital $ 17,867 $ 22,796 $ 26,103 $ 33,481 $ 37,365 $137,612 $128,868
0&M $ 51,019 $ 55,550 $ 53,474 $ 56,023 $ 59,897 $275,295 $257,358
In addition to capital investments for wildfire mitigation, the Company selects
transmission lines to rebuild with identified wildfire mitigation strategies, such as installation of
steel poles, cross arm replacements, and new insulators. WMP at 96-99. Starting in 2025, the
Company's WMP selected 14 transmission lines to be rebuilt with a forecast of$49.6 million.
The Company has selected 3 lines in 2026, 2 lines in 2027, and 1 line in 2027 to be rebuilt. Id.
Below is a table that displays the forecasted expenses for transmission line rebuilds.
STAFF COMMENTS 8 JUNE 17, 2025

Table No. 3: Transmission Line Rebuilds (000s)
2025 2026 2027 2028 2029 5 Year Idaho
Forecast Forecast Forecast Forecast Forecast Total
Transmission Line $ 49,614 $ 57,392 $ 69,400 $ 71,221 $ 35,092 $ 217,429
Rebuilds
Within the WMP's Performance Monitoring and Metrics section, the Company explains
that its internal audit department periodically conducts an evaluation of the WMP. However,
when inquired about any internal audits in Staff s Production Request No. 15, the Company
stated it did not have any internal audits performed specific to the WMP. Staff believes that this
is an important tool and recommends the Commission order the Company to perform an internal
audit of its WMP to be included with its next WMP filing with the Commission, consistent with
Order No. 35717.
Deferral Request
A deferred accounting order allows the Company to record expenses into a regulatory
asset account for later recovery; it is not a carte blanche approval to recover all expenses from
the Company's customers. Staff expects the Company to act prudently and provide sufficiently
detailed supporting documentation to support its prudence when it seeks recovery of these costs
in a subsequent filing. Additionally, Staff expects the Company to prudently mitigate these
expenses and provide supporting evidence of its cost mitigation efforts, such cost benefit
analyses. In this case, the granting of a deferral order does not limit Staffs right to audit,
question, or challenge the appropriateness, reasonableness, and prudence of any cost to be
deferred, as this sort of review is necessary to protect customers. Therefore, Staff recommends
the Commission authorize the Company to defer Idaho's share of incremental wildfire O&M
expenses into a regulatory asset account, with recovery of prudently incurred costs to be
determined in a subsequent rate proceeding, excluding the labor and standby helicopter service
expenses.
Absent an accounting order from the Commission, the Company would not be able to
recover these costs unless they were incurred during the Company's test year in a general rate
case. Allowing the Company to defer otherwise unrecoverable costs provides a sufficient benefit
to the Company. Staff recommends that the Commission authorize no carrying charge on the
STAFF COMMENTS 9 JUNE 17, 2025

regulatory asset account.
STAFF RECOMMENDATION
Staff recommends the Commission:
1. Confirm that the Company is correctly understanding its current authority to defer
expenses related to Vegetation Management, its Covered Wire Pilot Project, and its
Satellite Pilot Project as stated in Order No. 36042;
2. Authorize the Company to defer the additional identified expenses in the Company's
Application, except for labor and the standby helicopter service expenses, through 2025
or until the Company's next general rate case goes into effect;
3. Authorize no carrying charge for this regulatory asset;
4. Order the Company to detail how the Company identifies, selects,and evaluate projects
as least-cost least-risk for line rebuilding, undergrounding, and covered conductor to be
consistent with Idaho Code § 61-1803(3)(g),effective July 1, 2025 within the WMP;
5. Order the Company to list all pilot projects within the WMP, including the current status
of the pilot and an explanation of how the Company is evaluating least-cost, least-risk
solutions;
6. Order the Company to add a section to the WMP where it explains how the Company
addressed Staff s recommendations to the WMP and to discuss other high-level major
changes/updates to the WMP since the last filing; and
7. Order the Company to perform an internal audit of its WMP to be included with its next
WMP filing with the Commission.
Respectfully submitted this 17th day of June 2025.
�J117
J&ffirdtf W Loll
Deputy Attorney General
Technical Staff. Kimberly Loskot, Joe Terry, Shubhra Deb Paul
I:\Utility\UMISC\COMMEM'S\IPC-E-25-05 Commems-Redacted.docx
STAFF COMMENTS 10 JUNE 17, 2025

CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS / DAY OF JUNE 2025, SERVED
THE FOREGOING REDACTED COMMENTS OFMMISSION STAFF, IN
CASE NO. IPC-E-25-05, BY E-MAILING A COPY THEREOF, TO THE FOLLOWING:
LISA D. NORDSTROM KELLEY NOE
MEGAN GOICOECHEA ALLEN REGULATORY CONSULTANT
IDAHO POWER COMPANY IDAHO POWER COMPANY
PO BOX 70 PO BOX 70
BOISE ID 83707-0070 BOISE, ID 83707
E-MAIL: mgoicoecheaallenaidahopower.com EMAIL: knoe(c4idahoyower.com
lnordstromau idahopower.com
dockets(&idahopower.com
PATRICIA JORDAN, 3ECRETARY
CERTIFICATE OF SERVICE