20250815Surrebuttal Testimony Micron.pdf

RECEIVED
August 15, 2025
IDAHO PUBLIC
UTILITIES COMMISSION
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )
COMPANY'S APPLICATION FOR )
APPROVAL OF A SPECIAL CONTRACT )
AND TARIFF SCHEDULE 28 TO ) CASE NO. IPC-E-24-44
PROVIDE ELECTRIC SERVICE TO )
MICRON IDAHO SEMICONDUCTOR )
MANUFACTURING (TRITON) LLC )
Surrebuttal Testimony of
Michael P. Gorman
On behalf of
Micron Technology, Inc.
August 15, 2025
BRUBAKER&ASSOCIATES,INC.

1 Q. PLEASE STATE YOUR NAME AND BUSINESS ADDRESS.
2 A. Michael P. Gorman. My business address is 16690 Swingley Ridge Road, Suite 140,
3 Chesterfield, Missouri 63017.
4 Q. ARE YOU THE SAME MICHAEL P. GORMAN WHO PREVIOUSLY FILED DIRECT
5 REBUTTAL TESTIMONY ON JULY 30, 2025 IN THIS CASE?
6 A. Yes, I am.
7 Q. ON WHOSE BEHALF ARE YOU APPEARING IN THIS PROCEEDING?
8 A. I am appearing in this proceeding on behalf of Micron Technology, Inc. ("Micron").
9 Q. WHAT IS THE PURPOSE OF YOUR SURREBUTTAL TESTIMONY?
10 A. I will respond to the Rebuttal Testimony of Clean Energy Opportunities for Idaho
11 ("CEO") witness Michael Heckler.
12 Q. DOES THE FACT THAT YOU DO NOT ADDRESS EVERY ISSUE RAISED IN THE
13 REBUTTAL TESTIMONY OF OTHER PARTIES MEAN THAT YOU AGREE WITH
14 OTHER PARTIES' TESTIMONY ON THOSE ISSUES?
15 A. No. Dr. Lance Kaufman also filed Rebuttal Testimony on behalf of the Idaho Irrigation
16 Pumpers Association, Inc. ("IIPA") that I disagree with. However, I already responded
17 to Mr. Kaufman's arguments in my Rebuttal Testimony filed on July 30, 2025.
18 Q. WHAT IS YOUR OVERALL REACTION TO MR. HECKLER'S REBUTTAL
19 TESTIMONY?
20 A. Mr. Heckler makes several recommendations that are unsupported by evidence or rely
21 on flawed economic or policy analysis. If adopted, Mr. Heckler's recommendations
22 could result in Micron being subject to rates that are unjust and unreasonable and
23 potentially discriminatory. I will respond to several of Mr. Heckler's recommendations
24 below.
Gorman, Sur. 1
Micron Technology, Inc.

1 Q. PLEASE DESCRIBE THE RECOMMENDATIONS MADE BY MR. HECKLER TO
2 WHICH YOU ARE RESPONDING.
3 A. In his Rebuttal Testimony, Mr. Heckler made the following recommendations:
4 He proposes modifications to the Energy Service Agreement ("ESA")
5 concerning interconnection costs. Mr. Heckler proposes that Section 6.1 of the
6 ESA should be amended to make clear that additional transmission costs, not
7 limited to those needed for traditional interconnection facilities, should be
8 recovered from the special contract customer in upfront Contributions In Aid of
9 Construction ("CIAC") payments.'
10 Mr. Heckler takes issue with Idaho Power Company's ("IPC" or the "Company")
11 "No Harm" analysis noting that the analysis may have been developed based
12 on outdated data and may not accurately reflect the cost and revenues from
13 contract customers.2
14 He also proposed to expand the use of upfront CIAC payments to mitigate other
15 customers' risk and advance the "No Harm" protections.3
16 He states that it may be more preferrable for new contract load to procure power
17 competitively and not through IPC's regulated utility.4 He believes that this
18 would remove the risk to other customers by removing the additional production
19 cost IPC will assume to serve the Micron load.5
20 He also questions when the new contract customer will be shifted from marginal
21 cost energy pricing to embedded cost energy pricing. He opines that a
22 complicating factor for this shift occurs because the Company's 2025 Integrated
23 Resource Plan ("IRP") projects that IPC's marginal energy cost will revert to
24 being below embedded energy cost in the out years.6
25 He recommends the actual transition of Micron's new memory manufacturing
26 fabrication complex ("Micron Fab") from marginal energy costs to embedded
27 energy costs be resolved before the ESA is approved.7
' Rebuttal Testimony of CEO Witness Michael Heckler at 6:10-13.
2 Id. at 9:5-23.
3 Id. at 10:9-13.
4 Id. at 9:28-29.
5 Id. at 10:3-5.
6 Id. at 12:6-26.
Id. at 13:1-2.
Gorman, Sur. 2
Micron Technology, Inc.

1 Q. WHY IS MR. HECKLER PROPOSING GREATER CIAC PAYMENTS FOR
2 MICRON FAB INTERCONNECTION COSTS?
3 A. He states that the future Micron Fab load will be so large that it can be compared
4 to a series of traditionally sized new contract customers arriving every few months.$
5 He maintains that the initial contract interconnection costs may be inadequate to
6 cover all incremental transmission costs IPC will incur in order to serve the Micron
7 load.9 He opines that transmission upgrade costs are also needed. He references
8 the development of a new Mayfield transmission substation connecting to
9 500 kilovolt ("kV") transmission delivery voltage lines via a Hemingway link. This
10 transmission network upgrade will be used to serve Micron but is also expected to
11 produce benefits to IPC customers.10 This substation and interconnection will allow
12 IPC to connect Micron and it also "adds new market access and other system
13 benefits."11 Mr. Heckler asserts that some portion of the cost of this interconnection
14 should be paid by Micron.12
15 He concludes that all transmission-related costs needed to serve Micron
16 Fab should be recovered upfront through CIAC payments.13
17 Q. IS MR. HECKLER'S PROPOSAL TO INCREASE MICRON'S
18 INTERCONNECTION CIAC PAYMENTS REASONABLE?
19 A. No. Micron's CIAC payments should be limited to only infrastructure costs that
20 exclusively benefit Micron. The transmission upgrade costs that benefit all IPC
21 customers should be allocated across customer classes based on cost-causation
22 principles, including Micron and all other customers in prospective rate cases.
$ Id. at 4:20-21.
s Id. at 4:24-26.
10 Id. at 6:2-6.
11 Id.
12 Id.
13 Id. at 6:10-13.
Gorman, Sur. 3
Micron Technology, Inc.

1 Under this process, Micron and all other IPC customers will pay their fair share of
2 network transmission upgrade costs that are needed to provide reliable service at
3 the lowest cost possible. Transmission investments that provide access to new
4 markets and produce other system benefits create benefits for all IPC customers
5 and the cost should be recovered from all customers.
6 Mr. Heckler's proposal to include transmission network upgrade costs in
7 additional CIAC charges to Micron should be rejected because it would result in
8 Micron being exclusively charged costs for facilities that benefit all customers.
9 Q. DID MR. HECKLER MAKE COMMENTS CONCERNING THE COMPANY'S "NO
10 HARM" ANALYSIS IN SUPPORT OF MICRON FAB ESA?
11 A. Yes. Mr. Hecker maintains that the Company has not provided sufficient evidence
12 to conclude the ESA pricing terms will not harm IPC's existing customers. He states
13 that the evidence in this case includes the following:
14 • IIPA witness Dr. Kaufman's determination that the incremental cost of serving
15 Micron's load is higher than proposed in the ESA contract pricing.
16 • Uncertainty about the actual cost of serving the incremental load is outlined by
17 Mr. Eldred.
18 • Use of outdated data in determining the "No Harm" analysis.14
19 Mr. Heckler goes on to state that Dr. Kaufman's proposal to require Micron
20 to complete a competitive solicitation for power supply rather than procure power
21 from IPC under rate regulated service would mitigate risks and improve the "No
22 Harm" analysis objective.15 Also, Mr. Heckler reiterates his belief that increased
23 upfront CIAC payments from Micron would mitigate other customers' risk and
24 improve "No Harm" protections.16
14 Id. at 8:20—9:23.
15 Id. at 9:28-29.
16 Id. at 10:9:10.
Gorman, Sur. 4
Micron Technology, Inc.

1 Q. HOW DO YOU RESPOND TO MR. HECKLER'S CLAIM THAT THE COMPANY'S
2 "NO HARM" ANALYSIS SHOULD BE UPDATED IN ORDER TO ENSURE THE
3 ESA PRICING AND TERMS AND CONDITIONS WILL NOT HARM OTHER IPC
4 CUSTOMERS?
5 A. Mr. Heckler provides no evidence to support his claim. For reasons outlined in my
6 Rebuttal Testimony, Dr. Kaufman's estimate of the marginal cost of providing
7 service to Micron is unreliable and flawed." Mr. Heckler's reference to
8 Dr. Kaufman's testimony as support for his assertions is without merit.
9 Further, Mr. Heckler ignores the fact that the Company will update ESA
10 pricing and Schedule 28 based on changes in its cost of service over time.'$ The
11 ability to change ESA prices provides a hedge to IPC and its other customers to
12 ensure that the ESA provides full recovery of IPC's cost of serving Micron and, thus,
13 ensuring that other customers are not harmed.
14 Finally, Mr. Heckler's proposal for additional upfront CIAC payments for
15 infrastructure upgrades that benefit all customers, not just Micron, is imbalanced
16 and would not result in just and reasonable pricing under the ESA. Further,
17 increasing Micron's CIAC payments is unnecessary to protect other customers.
18 IPC's"No Harm" analysis is reasonable and demonstrates that the ESA and
19 pricing are designed to charge Micron IPC's cost of providing it service, and thus,
20 will not harm other IPC customers.
" Confidential Direct Rebuttal Testimony of Micron Witness Michael P. Gorman at 13:2—23:17.
18 Direct Testimony of IPC Witness Anderson at 12:11 — 13:3; 14:5-13.
Gorman, Sur. 5
Micron Technology, Inc.

1 Q. WHAT IS MR. HECKLER'S CONCERN REGARDING THE EXPECTED TRANSITION
2 FROM MARGINAL ENERGY PRICING TO EMBEDDED ENERGY PRICING UNDER
3 THE ESA?
4 A. Mr. Heckler states that the transition to embedded pricing from marginal energy pricing
5 is not well defined and should be resolved before the ESA is approved.19 This transition
6 includes the take or pay provision on demand charges, and the conversion from
7 marginal energy pricing to embedded energy pricing.20
8 Q. DOES THE ESA ESTABLISH AN APPROACH TO TRANSITION FROM
9 "INCREMENTAL" ENERGY COST PRICING TO EMBEDDED COST ENERGY
10 PRICING?
11 A. Yes. As noted by Mr. Heckler, IPC states that this transition will occur after the ramp
12 period, and when the Company can demonstrate that other customers will not be
13 harmed by the transition.21 After the ramp period, Micron's new load is expected to be
14 fully operational, and the risk of development and operation startup of the new facility
15 will no longer be at risk. Switching to embedded energy prices from marginal energy
16 prices at that time can allow IPC to ensure that the ESA pricing fully recovers its cost
17 of serving Micron and will not harm other customers. This revision to the ESA pricing
18 may actually help to ensure that other customers are not harmed if Mr. Heckler's
19 observation that IPC's marginal energy prices eventually become lower than average
20 embedded energy prices over time turns out to be accurate.22
21 The ESA contemplates the transition from Micron being an incremental
22 customer to an embedded cost customer, and structures this transition to occur without
23 harming other IPC customers.
19 Rebuttal Testimony of CEO Witness Michael Heckler at 13:1-2.
21 Id. at 12:6— 13:2.
21 Id. at 11:8-17.
22 Id. at 12:24-26.
Gorman, Sur. 6
Micron Technology, Inc.

1 Q. HOW DO YOU RESPOND TO THE SUGGESTION THAT MICRON SHOULD
2 PROCURE POWER COMPETITIVELY IN THE MARKET RATHER THAN FROM
3 IPC'S RATE REGULATED SERVICE?
4 A. Mr. Heckler's suggestion that the Micron Fab should procure energy on a competitive
5 basis ignores the fact that there is currently no competitive market option for Micron
6 and no legal framework or regime in Idaho that would allow Micron to pursue direct
7 retail access to electricity on a wholesale market. Mr. Heckler's recommendation that
8 Micron procure energy from a market on a competitive basis and not through IPC's rate
9 regulated entity would require legislative changes or potentially consent from IPC and
10 the Commission, which has not been requested in this proceeding. Additionally, the
11 Micron Fab is in a market region where the competitive generation market is not fully
12 developed and is not operated by a Regional Transmission Organization ("RTO") that
13 ensures unfettered market access, which limits non-load serving entities' access to
14 market power supply. Hence, precluding Micron from purchasing regulated power
15 delivery service from a regulated utility is discriminatory and may limit Micron's ability
16 to economically justify investments in IPC's service territory.
17 Q. HOW DO YOU RESPOND TO MR. HECKLER'S RECOMMENDATION THAT FINAL
18 REGULATORY APPROVAL OF THE ESA SHOULD NOT BE GRANTED AT THIS
19 TIME?
20 A. I disagree with Mr. Heckler, especially his suggestion that the Commission should only
21 provide the Micron Fab with "temporary rate guidance now, and which directs a process
22 for further review of open matters."23 Micron is in the midst of a substantial economic
23 investment in the City of Boise and Micron requires certainty about the regulated rate
24 framework that will govern its electric service from IPC. While the actual rates Micron
23 Id. at 15:14-18.
Gorman, Sur. 7
Micron Technology, Inc.

1 will be charged will change over the years through IPC's general rate cases, as such
2 rates change for all customers, the structural elements of the rates must be determined
3 in this case. Mr. Heckler's suggestion that the Micron Fab can be provided with
4 temporary rate guidance now, subject to later review, would result in uncertainty that
5 would make it nearly impossible for Micron or any other large IPC customers to invest
6 in IPC's service territory.
7 Q. DOES THIS CONCLUDE YOUR SURREBUTTAL TESTIMONY?
8 A. Yes, it does.
35574119_v6
Gorman, Sur. 8
Micron Technology, Inc.

I DECLARATION OF MICHAEL P. GORMAN
2 I, Michael P. Gorman, declare under penalty of perjury under the laws of the state
3 of Idaho:
4 1. My name is Michael P. Gorman. I am employed by Brubaker&Associates,
5 Inc. (`BAI") as a consultant in the field of public utility regulation.
6 2. On behalf of Micron Technology, Inc., I present this pre-filed surrebuttal
7 testimony in this matter.
8 3. To the best of my knowledge,my pre-filed surrebuttal testimony is true and
9 accurate.
10 I hereby declare that the above statement is true to the best of my knowledge and
11 belief, and that I understand it is made for use as evidence before the Idaho Public Utilities
12 Commission and is subject to penalty for perjury.
13 SIGNED this 15th day of August 2025, at Chesterfield, Missouri.
14 Signed:
15
16
17 35602553_v1
Declaration
Gorman, Sur. 1
Micron Technology, Inc.

CERTIFICATE OF SERVICE
I hereby certify that on August 15, 2025, a true and correct copy of the within and
foregoing SURREBUTTAL TESTIMONY OF MICHAEL P. GORMAN ON BEHALF OF
MICRON TECHNOLOGY, INC. IN CASE NO. IPC-E-24-44 was served in the manner shown
to:
Electronic Mail
Idaho Power Company
Megan Goicoecha Allen Connie Aschenbrenner
Donovan E. Walker Grant T. Anderson
Idaho Power Company Idaho Power Company
1221 W. Idaho Street(83702) 1221 West Idaho Street(83702)
PO Box 70 P.O. Box 70
Boise, ID 83707-0070 Boise, Idaho 83707
mgoicoecheaallengidahopower.com Telephone: [phone]
dwalker(abidahopowencom Facsimile: [phone]
docketskidahopower.com caschenbrennergidahopower.com
ganderson(ab idahopower.com
Commission Staff Micron Technology, Inc.
Monica Barrios-Sanchez *Austin Rueschhoff
Commission Secretary *Thorvald A. Nelson
Idaho Public Utilities Commission Austin W. Jensen
11331 W. Chinden Blvd., Building 8, *Kristine A.K. Roach
Suite 201-A Holland& Hart, LLP
Boise, ID 83714 555 17th Street, Suite 3200
secretary(apuc.idaho.gov Denver, CO 80202
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awj ens enkhollandhart.com
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*aclee(a,hollandhart.com
Idaho Irrigation Pumpers Association, Inc.
*Eric L. Olsen *Lance Kaufman, Ph.D.
ECHO HAWK& OLSEN, PLLC 2623 NW Bluebell Place
505 Pershing Avenue, Suite 100 Corvallis, OR 97330
P.O. Box 6119 lancegae isi�nsi hg t.com
Pocatello, ID 83205
elo(a,echohawk.com

Industrial Customers of Idaho Power
*Peter J. Rickardson *Dr. Don Reading
Richardson Adams, PLLC 280 S. Silverwood Way
515 N. 27th Street Eagle, ID 83716
Boise, ID 83702 dreadin mindsprin com
petergrichardsonadams.com
Clean Energy Opportunities for Idaho
*Kelsey Jae *Courtney White
920 N. Clover Drive *Mike Heckler
Boise, ID 83703 3778 Plantation River Drive, Suite 102
kelseykkelseyjae.com Boise, ID 83703
courtneykcleanenergyopportunities.com
mike&cleanenergyoPportunities.com
s/Adele Lee
*Denotes those with signed Confidentiality Agreements on file
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