20230427Staff 167-188 to AVU.pdf

CHRIS BURDIN
DEPUTY ATTORNEY GENERAL -ma 9:\4IDAHOPUBLICUTILITIESCOMMISSION
PO BOX 83720
BOISE,IDAHO 83720-0074
[phone]
IDAHO BARNO.9810
Street Address for Express Mail:
11331 W CHINDEN BLVD,BLDG 8,SUITE 201-A
BOISE,ID 83714
Attorneyfor the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF )CASE NO.AVU-E-23-01AVISTACORPORATIONFORTHE)AVU-G-23-01AUTHORITYTOINCREASEITSRATESAND)CHARGES FOR ELECTRIC AND NATURAL )SEVENTH PRODUCTION
GAS SERVICE TO ELECTRIC AND NATURAL )REQUESTOF THEGASCUSTOMERSINTHESTATEOFIDAHO.)COMMISSION STAFF
)TO AVISTA CORPORATION
The Staff of the Idaho Public Utilities Commission,by and through its attorney of record,
Chris Burdin,Deputy Attorney General,requests that Avista Corporation dba Avista Utilities
("Avista"or the "Company")provide the followingdocuments and information as soon as
possible,but no later than THURSDAY,MAY 11,2023.1
This Production Request is to be considered as continuing,and Avista is requested to
provide,by way of supplementary responses,additional documents that it,or any person acting
on its behalf,may later obtain that will augment the documents or information produced.
Please provide answers to each question;supporting workpapers that provide detail or are
the source of information used in calculations;and the name,job title,and telephonenumber of
i Staffis requesting an expedited response.If responding by this date will be problematic,please call Staff'sattorneyat(208)334-0314.
SEVENTH PRODUCTION REQUEST
TO AVISTA CORPORATION 1 APRIL 27,2023
the person preparing the documents.Please also identify the name,job title,location,and
telephonenumber of the record holder.
In addition to the written copies provided as response to the requests,please provide all
Excel spreadsheets and electronic files with formulas intact and enabled.
REQUESTNO.167:Please provide monthly costs and monthlyrevenues from the
Energy Imbalance Market ("EIM")since Avista began participation in the EIM.
REQUESTNO.168:Page 11 of Mr.Kalich's Testimony stated "CCA [('Climate
Commitment Act')]carbon allowance compliance is therefore modeled in Aurora such that each
thermal plant must overcome in its dispatch the Idaho share of the assumed carbon allowance
price,or about $23.87 per metric ton."However,in discussions with Mr.Kalich,the only plant
that included an allowance price in the Aurora dispatch was Boulder Park.Please reconcile these
two statements and confirm that only Idaho's share of the allowance cost was included in the
Aurora dispatch.
REQUESTNO.169:How does the Company plan to track the actual expenses of CCA
allowances for Idaho in the Power Cost Adjustment ("PCA").Please address each of the
followingconsiderations in your explanation:
a.The CCA allowances can be obtained from different sources with different prices,such as
auctions,bilateral,electronic exchange trading,and reserve accounts;
b.The CCA only requires a minimum of 30%of allowances to be retired in the year that
emissions occur with any balance due at the end of 2023-2026 Compliance Period;
c.According to Revised Code of Washington ("RCW")70A.65.120(3),"During the first
compliance period,allowances allocated at no cost to consumer-owned and investor-
owned electric utilities may be consigned to auction for the benefit of ratepayers,
deposited for compliance,or a combination of both";and
d.Avista can bank allowances for future uses.
SEVENTH PRODUCTION REQUEST
TO AVISTA CORPORATION 2 APRIL 27,2023
REQUESTNO.170:According to RCW 70A.65.120(3),"During the first compliance
period,allowances allocated at no cost to consumer-owned and investor-owned electric utilities
may be consigned to auction for the benefit of ratepayers,deposited for compliance,or a
combination of both."Please explain the following.
a.Do "ratepayers"include all Avista ratepayers (Idaho and Washington)or only
Washington ratepayers?
b.Please define the "first compliance period".
c.Will free allowances occur in subsequent compliance periods?
REQUESTNO.171:Please explain the role of e-tags in tracking actual expenses for
CCA allowances.
REQUESTNO.172:The first quarterly auction was held on February 28,2023.What
was the clearing price in the auction?
REQUESTNO.173:Please provide the emission factor adopted by the Washington
Department of Ecology.Please explain how it is calculated and why the emission factor is
appropriate for the unspecified energy under the Washington CCA.
REQUESTNO.174:Please update Table No.2 -Monthly Forward Prices at Key
Trading Hubs containedin Mr.Kalich's Direct Testimony based on the latest one-month average
of Intercontinental Exchange ("ICE")prices.
REQUESTNO.175:Please re-run the Aurora model using (1)the latest one-month
natural gas forwards prices and electric forwards prices provided in the previous request,and (2)
by includingRattlesnake Flat and Palouse Wind in the Aurora model for dispatch.Please update
Confidential Exhibit No.7 (based on the re-run)in electronic format with all formula enabled,
with the followingadditional information:
a.A breakdown of Columbia Basin Hydro ("CBH")costs by project;
b.A breakdown of CBH transmission costs by project;and
SEVENTH PRODUCTION REQUEST
TO AVISTA CORPORATION 3 APRIL 27,2023
c.A breakdown of Chelan PUD costs between the existing contract and the newly
signed contract.
REQUESTNO.176:Please re-run the Aurora model using (1)the latest one-month
natural gas forwards prices and electric forwards prices provided in the previous request,(2)by
including Rattlesnake Flat and Palouse Wind in the Aurora model for dispatch,and (3)removing
Idaho's share of the allowance price from Boulder Park's dispatch cost.Please update
Confidential Exhibit No.7 (based on the re-run)in electronic format with all formula enabled,
with the followingadditional information:
a.A breakdown of CBH costs by project;
b.A breakdown of CBH transmission costs by project;and
c.A breakdown of Chelan PUD costs between the existing contract and the newly
signed contract.
REQUESTNO.177:Please respond to the followingregarding the CBH projects,
which consists of seven projects:Russell D.Smith,E.B.C.4.6,Summer Falls Development,
P.E.C.66.0 Development,Quincy Chute Development,Main Canal Development,and P.E.C.
Headworks Development.
a.Please provide a copy of each contract for the seven projects;and
b.Please provide the contract price of each project with a reference to the page
number in the contract where it is listed.
REQUESTNO.178:Mr.Kalich's Direct Testimony states that the CBH was evaluated
as part of Avista's 2022 Request for Proposals ("RFP")process.However,Avista's 2023 Draft
Integrated Resource Plan ("IRP")states "[a]nnouncements adjacent to the 2022 All-Source RFP
include the acquisition of power from Columbia Basin Hydro's irrigation hydro generation
fleet..."Please respond to the following.
a.Please confirm that CBH was not a bid in the RFP but was evaluatedin the RFP
with other bidding projects.
b.Mr.Kalich's Testimony states that "[a]full accounting and reporting for CBH will
be sponsored in testimony in our next Idaho general rate case,once all resources
SEVENTH PRODUCTION REQUEST
TO AVISTA CORPORATION 4 APRIL 27,2023
procured as part of the RFP process are under contract".Is the Company seeking
a determination of prudence for any of the CBH projects in this case?If so,
please state which one(s).
c.If the Company is seeking a determination of prudence for any of the projects,
please provide the Company's justification of need for each of these projects.
Please provide evidence to support the justification.
d.Please provide a comparison of the contract price(s)of each CBH project to the
contract price of each selected project from the RFP on an equivalent basis.
e.Please provide the scoring matrix used to select the short list and final selection of
resources in the RFP.
REQUESTNO.179:Please provide monthly flat Mid-C prices at the 10th perCORÍile,
50th percentile,and 90th percentile as determined in the 2021 IRP for the period from 2023
through 2045 and compare these to the contract prices for the followingon an equivalent basis:
a.Each CBH project,and
b.The two newly signed Chelan contracts referenced in Mr.Kinney's Direct
Testimony.
REQUESTNO.180:Mr.Kinney's Direct Testimony states that Avista's 2020 IRP
identified the need for additional renewable resources to meet clean energy goals of carbon
neutralityby 2027,100 percent clean electricity by 2045,and that the 2020 RFP was issued to
meet the need.The Chelan contracts were selected in the 2020 RFP.Please explain whether the
Chelan contracts were intendedto meet clean energy goals only,or energy needs and capacity
needs as well.Please provide evidence to support your answer.
REQUESTNO.181:Mr.Kinney's Testimony states that the two newlysigned Chelan
contracts include one with a term of January 1,2024,throughDecember 31,2033,and one with
a term of January 1,2026,throughDecember 31,2045.Please confirm that the Company is only
seeking prudence determination of the contract with a term of January 1,2024,through
December 31,2033,in this case.
SEVENTH PRODUCTION REQUEST
TO AVISTA CORPORATION 5 APRIL 27,2023
REQUESTNO.182:Please provide an Excel file that contains the following
information for the Chelan contract with a term of January 1,2024,through December 31,2033.
a.The expected hourly generation profile of the project for the contract term.
b.The hourly contract prices.
c.The 500 Net Present Values ("NPV")results of the followingcalculation:(1)
Calculate the hourly differences between the project values and the market values
using Hourly Difference =(Hourly Contract Price -Mid-C Price)*Hourly
Generation,where Mid-C Prices are developedfrom the 500 iterations of the
Expected Case in Chapter 10 of the 2021 IRP,and (2)using the discount rate from
the 2021 IRP to calculate the NPV of the hourly differences.(This step may use a
query function similar to the method used in "Staff_PR_ll5CConfidential
SupplementalAttachment B -Rattlesnake Margin by Iteration.xlsx"in Case No.
AVU-E-19-04).
d.The percentage of the 500 NPVs from part (c)that have values greater than 0.
e.The 500 NPV results calculated by repeatingpart (c)with one change to the
formula:
Hourly Difference =(90%*Hourly Contract Price -Mid-C Price)*Hourly
Generation.
f.The percentage of the 500 NPVs from part (e)that have values greater than 0.
REQUESTNO.183:Please provide an excel file that contains the following
information for each of the CBH projects.
a.The expected hourly generationprofile of the project for the contract term.
b.The hourly contract prices.
c.The 500 Net Present Values ("NPV")results of the followingcalculation:(1)
Calculate the hourly differences between the project values and the market values
using Hourly Difference =(Hourly Contract Price -Mid-C Price)*Hourly
Generation,where Mid-C Prices are developedfrom the 500 iterations of the
Expected Case in Chapter 10 of the 2021 IRP;and (2)using the discount rate
from the 2021 IRP to calculate the NPV of the hourly differences.(This step may
use a query function similar to the method used in "Staff PR ll5C Confidential
SEVENTH PRODUCTION REQUEST
TO AVISTA CORPORATION 6 APRIL 27,2023
SupplementalAttachment B -Rattlesnake Margin by Iteration.xlsx"in Case No.
AVU-E-19-04).
d.The percentage of the 500 NPVs from part (c)that have values greater than 0.
e.The 500 NPV results calculated by repeating part (c)with one change to the
formula:
Hourly Difference =(90%*Hourly Contract Price -Mid-C Price)*Hourly
Generation.
f.The percentage of the 500 NPVs from part (e)that have values greater than 0.
REQUESTNO 184:Please provide the Idaho Jurisdictional net rate base for both
electric and natural gas service calculated as of March 31,2023,using both the Averageof
MonthlyAverages ("AMA")and End of Year calculations.Please provide all workpapers
supporting the calculations.
REQUESTNO.185:Please update the Company's Idaho electric and Idaho gas
revenue requirement models using a March 31,2023,test year end using AMA rate base.
REQUESTNO.186:Please provide an updated Net Power Cost using a March 31,
2023,test year end.
REQUESTNO.187:Please provide updated weather and revenue normalization
calculations using a March 31,2023,test year end.
REQUESTNO.188:Please provide an updated Cost of Service Model using a March
31,2023 test year end.
SEVENTH PRODUCTION REQUEST
TO AVISTA CORPORATION 7 APRIL 27,2023
DATED at Boise,Idaho,this dhayofApril 2023.
Chris Burdin
Deputy Attorney General
i:umisc:prodreq/avue23.l_avug23.lcbde prod reg 7
SEVENTH PRODUCTION REQUEST
TO AVISTA CORPORATION 8 APRIL 27,2023
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 27th DAY OF APRIL 2023,SERVED THE FOREGOING SEVENTH PRODUCTION REQUESTOF THECOMMISSIONSTAFFTOAVISTACORPORATION,IN CASE NOS.AVU-E-23-01/AVU-G-23-01,BY E-MAILING A COPY THEREOF TO THE FOLLOWING:
PATRICK EHRBAR DAVID J MEYERDIROFREGULATORYAFFAIRSVP&CHIEF COUNSELAVISTACORPORATIONAVISTACORPORATION
PO BOX 3727 PO BOX 3727
SPOKANE WA 99220-3727 SPOKANE WA 99220-3727E-mail:[e-mail] E-mail:[e-mail]
[e-mail]
PETER J RICHARDSON DR DON READING
RICHARDSON ADAMS PLLC 280 SILVERWOOD WAY515N27THSTREETEAGLE,ID 83616BOISEID83702E-mail:[e-mail]-mail:[e-mail]
Electronic Service Only:
[e-mail]
[e-mail]
[e-mail]
ANDREW P MORATZKA LARRY A CROWLEYSTOELRIVESLLPTHEENERGYSTRATEGIES INSTITUTE
33 SOUTH SIXTH STREET,SUITE 4200 3738 S HARRIS RANCH AVE.MINNEAPOLIS,MN 55402 BOISE ID 83716
E-MAIL:[e-mail] E-mail:crowleyla aol.com
JUSTINA A.CAVIGLIA STEVE W CHRISS
PARSONS BEHLE &LATIMER DIRECTOR,ENERGY SERVICES50W.LIBERTY STREET,SUITE 750 WALMART INC
RENO,NV 89502 2608 SOUTHEAST J STE-MAIL:[e-mail] BENTONVILLE AR 72716
E-MAIL:[e-mail]
CERTIFICATE OF SERVICE
MARIE CALLAWAY KELLNER BRAD HEUSINKVELDIDCONSERVATIONLEAGUEIDCONSERVATIONLEAGUE710N6THST710N6THST
BOISE ID 83702 BOISE ID 83702E-MAIL:mkellner idahoconservation.org E-MAIL:
[e-mail]
F DIEGO RIVAS
NW ENERGY COALITION
1101 8TH AVE
HELENA MT 59601
E-MAIL:[e-mail]
SECRE ARY
CERTIFICATE OF SERVICE