200310281st Response of ID Power to Staff.pdf

BARTON L. KLINE , ISB # 1526
MONICA MOEN , ISB # 5734
Idaho Power Company
1221 West Idaho Street
P. O. Box 70
Boise , Idaho 83707
Telephone: [phone]
FAX Telephone: [phone]
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2003 OCT 27 PH 5: 54
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Attorneys for Idaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF
IDAHO POWER COMPANY FOR A
CERTIFICATE OF PUBLIC CONVENIENCE
AND NECESSITY FOR THE RATE BASING
OF THE BENNETT MOUNTAIN POWERPLANT.
CASE NO. IPC-03-
IDAHO POWER COMPANY'S
RESPONSE TO FIRST
PRODUCTION REQUEST
OF COMMISSION STAFF
COMES NOW Idaho Power Company ("Idaho Power" or "Company ), and
herewith files its response to a portion of the First Production Request of Commission
Staff dated October 10 , 2003.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 1
REQUEST NO.6: Please provide a list of representatives of potential
bidders who attended the pre-bid meeting on March 7, 2003.
RESPONSE TO REQUEST NO.6: The requested information is a part of
the documentation for the 2003 RFP process. The documentation is voluminous and
contains information that the Company and/or the respective bidders consider to be
confidential information and/or trade secrets. Idaho Power has assembled the
documentation for the 2003 RFP in a discovery room at Idaho Power. Upon execution
of a Confidentiality Agreement, Staff and intervenors may review the documents at
Idaho Power. Any party desiring to review documents in the discovery room should call
Celeste Schwendiman at 388-6447 to arrange a time for the room to be made available.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSETO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 2
REQUEST NO.7: Please provide a copy of all "Notice of Intent to Bid"
forms completed and submitted to Idaho Power by interested bidders in the 2003 RFP
process.
RESPONSE TO REQUEST NO.7: See Response to Request No.
The Response to this Request was prepared by Barton L. Kline , Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 3
REQUEST NO.8: Please provide a copy of any evaluations
recommendations, or other correspondence from R.W. Beck related to the February
2003 RFP , the RFP evaluation criteria or the review and evaluation of bids.
RESPONSE TO REQUEST NO.8: See Response to Request No.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 4
REQUEST NO.9: Please provide copies of all bids received in response
to the February 2003 RFP.
RESPONSE TO REQUEST NO.9: See Response to Request No.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 5
REQUEST NO.1 0: Please provide a copy or complete description of all
criteria used to evaluate bids received in the RFP.
RESPONSE TO REQUEST NO. 10: See Response to Request No.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 6
REQUEST NO. 11: Please provide copies of all analysis conducted by the
Company in evaluating RFP bids.
RESPONSE TO REQUEST NO. 11: See Response to Request No.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 7
REQUEST NO. 12: Please indicate those bids eliminated in the "short
listing" that occurred during May 2003. Please state the reasons why each bid was
eliminated.
RESPONSE TO REQUEST NO. 12: See Response to Request No.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 8
REQUEST NO. 13: Please identify and provide a copy of each bid
received that, on its own or in combination with other less than full requirements bids
were insufficient to satisfy the need identified in the RFP. Are any of these bids still
being considered? Does Idaho Power expect to consider any of these bids in the
future? If so , please explain.
RESPONSE TO REQUEST NO. 13: See Response to Request No.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 9
REQUEST NO. 14: Please provide analysis demonstrating that the
Bennett Mountain project was the least cost alternative for meeting Idaho Power
needs.
RESPONSE TO REQUEST NO. 14: See Response to Request No.
The Response to this Request was prepared by Barton L. Kline, Idaho
Power counsel.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 1
REQUEST NO. 15: Please provide a copy of any firm wholesale electric
and natural gas price forecasts used in any of the analysis of bids received in the
February 2003 RFP.
RESPONSE TO REQUEST NO. 15: A copy of the gas price forecast
used in the evaluation of the February 2003 RFP bids is included in the Evaluation
Manual. A copy of the Evaluation Manual is in the discovery room and may be
reviewed in accordance with the procedures described in Response No.
The Response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Planning, Idaho Power Company, in consultation with Barton L.
Kline , Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 11
REQUEST NO. 16: Please provide documentation of the self-build
options used for comparison purposes in the RFP bid evaluation process. Include a
complete description of the plants; a complete description of the types , sizes and
manufacturers of turbines; cost estimates of major plant components; and a financial
analysis of the alternatives that will enable ready comparison to other alternatives.
RESPONSE TO REQUEST NO. 16: The requested materials are located
in the discovery room and may be reviewed in accordance with the procedures
described in Response No.6. See also the Response to Request No. 18.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 12
REQUEST NO. 18: In reference to page 7, lines 15-17 of Said's direct
testimony, please describe what is meant by a "teaming arrangement consisting of
Black and Veatch , TIC and a separate group within Idaho Power s Power Supply
Department." Please identify the roles and responsibilities of each group who
participated in preparing the self-build alternative proposal.
RESPONSE TO REQUEST NO. 18: To assist in the understanding of
how the self-build option was developed and evaluated, the following is provided:
To ensure that the Company s self-build option would be evaluated on an
equal footing with all other proposals, prior to receiving any bids the Company chose a
bid evaluation team which developed an Evaluation Manual setting out the criteria by
which all bids would be evaluated. The bid evaluation team was made up of personnel
representing a number of disciplines within the Company, i.e., power supply planning,
transmission, finance, legal , rates, etc. The Company then identified personnel in the
Company s Power Supply operations group who would be responsible for developing
the self-build proposal (self-build team). Members of the evaluation team were directed
not to convey any information regarding either the bids or the evaluation process to the
members of the self-build team unless that information was also disclosed to all other
bidders.. In addition, separate senior management personnel were assigned to the self-
build team and the evaluation team to provide management oversight of each team.
Managers assigned to the evaluation team were advised that they could not convey
information regarding the evaluation process to any member of the self-build team. In
addition , other Company employees assisting the evaluation team in its work were
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 13
advised that they could not convey information regarding the evaluation process to the
self-build team.
The self-build team determined that the best way to develop a complete
competitive self-build proposal would be to join forces with contractors possessing a
great deal of experience and expertise in building combustion turbines. The self-build
team identified Black & Veatch and The Industrial Company ("TIC") as meeting these
criteria. Idaho Power, Black & Veatch and TIC entered into a teaming agreement in
which each of the entities would contribute to the joint effort to submit a superior
proposal. Broadly stated , Idaho Power would contribute the turbine generator, Black &
Veatch would contribute the engineering, and TIC would perform the actual on-site
construction. The details of the teaming arrangement are more specifically described in
the Teaming Agreement which is located in the discovery room and can be reviewed in
accordance with the procedures described in Response No.6. Ultimately, the self-build
team submitted several alternative proposals and one of them was selected for short-list
evaluation.
The Response to this Request was prepared by Barton L. Kline , Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 14
REQUEST NO. 19: Please identify the members of Idaho Power s RFP
evaluation team.
RESPONSE TO REQUEST NO. 19:
Name Title
Karl Bokenkamp
T om Noll
Celeste Schwendiman
Ron Schellberg
Catie Miller
G reg Said
Bart Kline
Monica Moen
Jason Keil
Gen. Mgr., Power Supply Planning
Customer & Load Research Leader
Pricing Analyst
Engineering Leader - Delivery
Finance Team Leader
Manager, Revenue Requirement
Senior Attorney
Attorney
Credit Manager, IDACORP Risk Mgmt.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 21: Please describe any transmission system additions or
improvements , including cost, which will be needed to interconnect the Bennett
Mountain plant into Idaho Power s existing system.
RESPONSE TO REQUEST NO. 21: Interconnection studies are still
underway regarding the integration of the Bennett Mountain plant into the Boise Bench-
Midpoint 230 kV system. The final transmission configuration for the Bennett Mountain
plant is dependant upon completion of Sub-Synchronous Resonance (SSR) studies.
SSR is a interaction between the mechanical shaft of a generating unit and a series
compensated transmission system. The Boise Bench-Midpoint #2 230 kV line is series
compensated. Idaho Power has successfully mitigated SSR issues at the Jim Bridger
plant. If SSR concerns related to the Bennett Mountain plant site can be mitigp.ted, the
preferred transmission plan is to:
Build approximately 5 miles of single circuit 230 kV line between the Bennett
Mountain site and the Boise Bench-Midpoint #2230 kV line.
Construct a 230 kV substation at Bennett Mountain plant.
Construct a 230 kV switching station (Rattlesnake) where the Bennett
Mountain 230 kV Line intersects the Boise Bench-Midpoint #2 230 kV line.
Install a SSR mitigation scheme at Midpoint on the Midpoint-Boise Bench #2
series capacitor.
Upgrade two short sections of the Boise Bench-Midpoint #2 line from a single
conductor to bundled conductor.
Preliminary estimates of the cost of this option are approximately $5 500 000.
If the SSR studies indicate that potential shaft damage can not be reasonably
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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mitigated , a more expensive transmission alternative would be pursued. Build
approximately 4 mile Double circuit 230 kV line between the Bennett Mountain
site and the Boise Bench-Midpoint #1 230 kV line.
Construct a 230 kV substation at Bennett Mountain plant.
Rebuild 40 miles of the Boise Bench-Midpoint #1 230 kV line from intersection
point to Boise Bench with larger conductor.
Reconfigure the 230 kV lines at the DRAM Substation.
No preliminary estimates of the cost of this option have been developed
but the costs are expected to be in excess of $11 million.
The Response to this Request was prepared by Ronald D. Schellberg,
System Planning Leader, Idaho Power Company, in consultation with Barton L. Kline
and Monica B. Moen, attorneys for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 22: Please describe any transmission system additions or
improvements , including cost and construction timing, which will be needed between
Mountain Home and Boise. Are there any improvements being made in the general
vicinity of the Bennett Mountain plant that Idaho Power would have made whether the
Bennett Mountain plant was built or not?
RESPONSE TO REQUEST NO. 22: See Response to Request No. 21.
These improvements are solely for the integration of the Bennett Mountain plant.
The Response to this Request was prepared by Ronald D. Schellberg,
System Planning Leader, Idaho Power Company, in consultation with Barton L. Kline
and Monica B. Moen , attorneys for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 18
REQUEST NO. 23: Please describe the transmission constraints that
made it desirable or necessary for Idaho Power to specify in the February 2003 RFP
that a plant should be located in the Boise area. Provide copies of any analysis or
transmission system studies in which these constraints were identified and described.
RESPONSE TO REQUEST NO. 23: The June 20021RP document lists
the major transmission constraints, Northwest to Idaho, Brownlee East, and Borah
West. Northwest to Idaho is limited to 1100 MW (summertime actual flow during peak
load hours). Brownlee East is limited to 1750 MW (1850 MW with the completion of
Brownlee-Oxbow during peak load hours). Borah West is limited to 2307 MW (limiting
during light load hours). Copies of the WECC Operating Transfer Capability study
results are available in the discovery room. The RFP described to the potential bidders
the cost impacts of siting projects within these major constraints.
The Response to this Request was prepared by Ronald D. Schellberg,
System Planning Leader, Idaho Power Company, in consultation with Barton L. Kline
and Monica B. Moen , attorneys for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 24: Please provide cost estimates and a description of
the improvements that would be necessary for Idaho Power to relieve transmission
constraints into its system such that power could be imported from the market as an
alternative to building the Bennett Mountain plant. Provide a copy of any studies or
analysis that has been completed.
RESPONSE TO REQUEST NO. 24: In the June 2002 IRP, transmission
upgrades to the Northwest and to Borah West were discussed in Chapter 5 in the
Transmission Resources section. Construction of these type of transmission lines
would be expensive and is expected to take at least 8 years. A copy of the pertinent
section of the 2002 IRP is attached.
The Response to this Request was prepared by Ronald D. Schellberg,
System Planning Leader, Idaho Power Company, in consultation with Barton L. Kline
and Monica B. Moen, attorneys for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
PRODUCTION REQUEST OF COMMISSION STAFF Page 20
REQUEST NO. 25: Please explain , given the transmission constraints
identified in Request No. 23, whether and how surplus energy from the plant will be
transmitted outside of Idaho Power s system and sold.
RESPONSE TO REQUEST NO. 25: Idaho Power is constructing the
Bennett Mountain plant to serve peak loads within the Idaho Power service territory and
does not anticipate significant off system sales from these peaking resources.
However, should the price of fuel and increased maintenance costs allow the production
cost to be less than prevailing market prices, the plant may be operated and the output
sold to available external markets. The Company believes that under most conditions it
will have out-bound transmission available , but transmission capacity may not be
available to the optimal markets.
The Response to this Request was prepared by Ronald D. Schellberg,
System Planning Leader, Idaho Power Company, in consultation with Barton L. Kline
and Monica B. Moen , attorneys for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 26: Please describe in detail any transmission system
improvements, upgrades or additions that have recently been made or are planned in
the general vicinity of the proposed Bennett Mountain plant. Provide a copy of any study
or analysis completed that recommended such improvements, additions or upgrades.
For any upgrades that have recently been completed, please provide records showing
the total costs for the improvements, additions or upgrades.
RESPONSE TO REQUEST NO. 26: There have not been any recent
transmission system improvements , upgrades or additions in the general vicinity of the
proposed Bennett Mountain plant and none were previously planned.
The Response to this Request was prepared by Ronald D. Schellberg,
System Planning Leader, Idaho Power Company, in consultation with Barton L. Kline
and Monica B. Moen, attorneys for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 27: Will it be necessary to construct a substation as a
part of or in conjunction with the Bennett Mountain project? If so , who will be
responsible for paying for the cost to construct the necessary substation, Idaho Power
or Mountain View? If it will not be necessary to construct a substation, will any
improvements have to be made to nearby existing substations? If so, please identify
those substations and list and itemize the costs of the planned improvements.
RESPONSE TO REQUEST NO. 27: Yes, there will be a substation at
Bennett Mountain plant to interconnect to the 230 kV system. Idaho Power will pay for
the substation. The improvements necessary to integrate the plant are described in the
Response to Request No. 21.
The Response to this Request was prepared by Ronald D. Schellberg,
System Planning Leader, Idaho Power Company, in consultation with Barton L. Kline
and Monica B. Moen , attorneys for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 28: Please discuss the status of the Southwest Intertie
Project. Is the project still being pursued , what would be the capacity and cost of the
project, when would it be completed and would it provide Idaho Power access to the
market and thus eliminate the Company s need to construct new power plants?
RESPONSE TO REQUEST NO. 28: The right-of-way for the
development has been granted and the project could be constructed. Development of
the line would require investment by multiple parties and periodically Idaho Power
receives indications of interest, but to date nothing firm has developed. The project
would be approximately 500 miles in length with an approximate cost of $400 to $500
million and a capacity of 1000 to 1200 MW. It would take about 4 years to construct
once funding was approved. It is extremely unlikely that the line would eliminate the
Company s need to construct new power plants because the line would reach into a
summer peaking region, which would coincide with Idaho Power s summer peak. To
have an assured capacity to meet firm load requirements, it is likely that Idaho Power
would have to contract to purchase firm power plant capacity, which is usually
equivalent to constructing new power plant capacity.
The Response to this Request was prepared by Ronald D. Schellberg,
System Planning Leader, Idaho Power Company, in consultation with Barton L. Kline
and Monica B. Moen , attorneys for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 38: If an additional generating unit could be added at the
Bennett Mountain project site, how much additional capacity could be added?
RESPONSE TO REQUEST NO. 38: The Bennett Mountain plant site
could accommodate another generating unit at the site, as well as reconfiguration of
simple cycle generators into combined cycle generators, depending on the Company
future load growth and load profiles. A simple cycle expansion would , most likely,
involve adding a second 501 FD turbine generator, thus doubling the capacity of the
site. The existing generator could also be converted to combined cycle, allowing
capacity to grow from the current 162 MW to around 250 MW. Two generators both
operating in combined cycle mode would approximate 500 MW.
The Site is located very near two natural gas pipes owned by Williams
Company, and multiple transmission interconnection options. Transmission constraints
, on the Idaho Power system will play an important role in any potential future expansion
of the Bennett Mountain site.
If generating capacity at the site were to be increased , the City of
Mountain Home would have to either amend the existing Conditional Use Permit
granted to Mountain View Power at the site , or issue a second permit for the plant
expansion. The City has indicated it has sufficient water supply for an expansion of a
simple cycle operation at the site. If the generating equipment at the site were to
convert to combined cycle, then Idaho Power would , most likely, have to assist the City
in securing the necessary water supply for the combined cycle operation. The City of
Mountain Home has indicated that its existing wastewater treatment operation could
accommodate plant expansion , either simple or combined cycle.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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The Response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Planning, Idaho Power Company, in consultation with Barton L.
Kline , attorney for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 39: Is Idaho Power aware of any plans Mountain View
Power may have to build additional capacity at the Bennett Mountain site? Does Idaho
Power have any plans to build additional capacity at the site in the future?
RESPONSE TO REQUEST NO. 39: The Bennett Mountain Power Plant
site is located within an industrial park owned by the City of Mountain Home, Idaho.
Idaho Power is not aware of any plans that Mountain View Power may have to build
additional generating capacity in the industrial park and Mountain View Power has
represented to Idaho Power that they have no such plans for the site. Idaho Power has
no current plans to build additional generating capacity adjacent to the Bennett
Mountain Power Plant. However, depending on the outcome of the Company s 2004
IRP , the Bennett Mountain site could qualify as a candidate for the siting of additional
generating capacity.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 42: Please provide copies of any permits Idaho Power or
Mountain View has obtained with local , state or federal air, water, solid waste or land
management agencies. Please also summarize the status of all other permits that have
not yet been obtained but that will eventually be necessary for construction and
operation of the plant.
RESPONSE TO REQUEST NO. 42: Please see the attached" Schedule
of Permits and Governmental Approvals' for a comprehensive list of all approvals
certificates , permits and licenses needed for the completed plant. Also attached are the
following permits currently held by Mountain View concerning the plant.
Idaho Department of Environmental Quality Air PermittinQ
(a)A Final Permit to Construct ("Air Permit") AIRS Facility No. 039-0025 was
issued to MVP on September 9, 2002. The Project's final air permit is for the operation
of two General Electric LM6000 Sprint/PC simple-cycle combustion turbines.
(b)On September 22, 2003 Mountain View submitted a new Application for
An Air quality Permit to Construct and operate a Westinghouse 501 FD turbine
generator. On October 21 2003 , at the request of Idaho Power, Mountain View
submitted a new/amended Application for the same equipment package , but configured
on the site differently than as shown in the September 22 application. A copy of the
October 21 2003 DEQ air permit application is attached. Mountain View anticipates
receiving from DEQ a Permit to Construct on or before December 31 , 2003.
Conditional Use Permit from the City of Mountain Home : The Project Site
is located in the Mountain View Industrial Park owned by the City of Mountain Home.
The City granted Mountain View a Conditional Use Permit ("CUP") on February 12
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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2002 for the Project at the Site. This original CUP required that the permit be "acted
upon" within one year of issuance and limited energy production at the Project to "
maximum of 130 MW." In November of 2003 the City of Mountain Home extended the
CUP for an additional one year period of time.
On March 7, 2003 Mountain View applied for an amendment of its CUP to
increase the electrical generating capacity at the site from 130 MW to 180 MW , and to
extend the termination date of the CUP to December 31 2004. The Mountain Home
City Council approved the proposed amendments to the CUP, with the amended CUP
issued and recorded on April 24 , 2003.
Real Property Lease from the City of Mountain Home : The City of
Mountain Home has also provided Mountain View with a draft lease for use of Site
located within the City Mountain View Industrial Park. The lease provides that
Mountain View will lease 9.88 acres for an initial term of 5 years , and that MVP shall
have the right to renew and extend the term of the lease for nine successive periods of
five years each on the same terms and conditions as contained in the initial term
except for price. The initial term lease price is $2 000.00 per acre per year, with
extended term price increases equal to increases of the Consumer Price Index for
Urban Consumers. A copy of the City lease is attached. Mountain View will execute
the lease when Idaho Power provides to Mountain View a Notice to Proceed. Idaho
Power will issue Mountain View a Notice to Proceed after the Commission issues an
acceptable Certificate of Pubic Convenience and Necessity.
Water and Sewer Service from the City of Mountain Home: Mountain
Home has also committed to provide both water and waste-water treatment for the
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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Project at the Site. Simple cycle operation of any of the Options proposed would not
exceed 250 GPM. An August 2002 letter from Mountain Home Mayor Dave Jett to
Mountain View (a copy of which is attached) states that:
(T)he City of Mountain Home is committed to providing you with 250
gallons of water per minute for your facility. Your plant discharge into our
sewer system is no problem. Furthermore, we will work with Mountain
View Power to provide additional water and sewer service in the future , if
needed.
Idaho Department of Transportation . On November 28, 2001 the Idaho
Department of Transportation issued Power Development Associates (a predecessor
company to Mountain View Power) a "Permit to use Right-of-Way" for purposes of
constructing an underground pipeline for natural gas interconnection. The gas
interconnection , however, may utilize a BLM permit or a private easement, instead of
this public right of way. A copy of this IDOT permit is attached , as well as the
assignment from Power Development Associates to Mountain View.
BLM Crossinq Permit. On June 30, 2003 the Bureau of Land
Management issued a Right of Way permit to cross BLM land for purposes of
constructing both a 138 transmission line connecting the Project to Idaho Power
Mountain Home Junction substation , and for constructing a natural gas pipeline
interconnection. A copy of this BLM permit is attached.
The Response to this Request was prepared by Barton L. Kline , Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 43: If additional capacity is added at the project site in the
future, will existing permits be sufficient to permit expansion? What additional permits
would have to be obtained?
RESPONSE TO REQUEST NO. 43: Please see Response Nos. 38 and
42. For plant expansion , the Conditional Use Permit from the City of Mountain Home
would have to be amended to accommodate plant expansion. Similarly, a second DEQ
air permit would be required. As discussed in Response No. 38, a combined cycle
operation requiring additional water would necessitate Idaho Power and the City
working together to secure that water source.
The Response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Planning, Idaho Power Company, in consultation with Barton L.
Kline , attorney for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 44: If either Idaho Power or Mountain View defaults
under the Agreement , how will Idaho Power meet load both in the short-term and the
long-term?
RESPONSE TO REQUEST NO. 44: If Idaho Power does not proceed
with the Bennett Mountain Power Plant, it would be necessary for Idaho Power to
increase its wholesale purchases in the short term and accelerate its efforts to acquire
additional generating resources as described in the 2002 IRP. If Mountain View
defaults, Idaho Power has the right to "step-through" the contract, remove Mountain
View from the site and the Project, and work directly with Siemens Westinghouse to
complete construction of the plant.
The Response to this Request was prepared by Karl Bokenkamp, General
. Manager, Power Supply Planning, Idaho Power Company, in consultation with Barton L.
Kline, attorney for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 47: Will the Company at any time be paid by Mountain
View Power, Inc. to act as its agent? Does the Company assume any risk by acting as
Mountain View , Inc.'s agent?
RESPONSE TO REQUEST NO. 47: Idaho Power will not act as Mountain
View Power s agent.
The Response to this Request was prepared by Barton L. Kline , Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 51: Please explain why Idaho Power is not including
transmission costs in its commitment estimate. How and when is Idaho Power
proposing to recover transmission costs?
RESPONSE TO REQUEST NO. 51: The Company requests certificates
of public convenience and necessity for generation projects from the Idaho Public
Utilities Commission consistent with Idaho Code , ~ 61-526. As part of the request for a
certificate of public convenience and necessity, the Company has provided a
commitment estimate for the generation project addressed by the certificate of
convenience and necessity. Certificates of convenience and necessity are not required
for extension of the Company s existing transmission system. The cost of transmission
can vary substantially based on numerous factors. The Company is currently
performing the studies necessary to establish firm transmission costs. See the
Response to Request No. 21.
Once the new transmission has been built and is used to provide power to
customers, the Company will ask for the inclusion of the costs of such transmission in
the Company s rate base for ratemaking purposes.
The Response to this Request was prepared by Gregory W. Said
Director, Revenue Requirement, Idaho Power Company, in consultation with Monica B.
Moen, attorney for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 52: Please describe in greater detail and provide
examples of what constitutes "legally required equipment changes" mentioned on page
5 of the Application. Provide a range of possible costs of such "required equipment."
RESPONSE TO REQUEST NO. 52: It is necessary for Idaho Power to
qualify its commitment estimate by excluding "legally required equipment changes" to
address the possibility of legally-mandated changes to equipment arising after the time
the commitment estimate was developed. One example would be changes in the Clean
Air Act that would require installation of additional pollution control equipment. If the
installation of such equipment was not required at the time the commitment estimate
was developed , the commitment estimate would not reflect the additional cost of such
newly required equipment. It would not be reasonable to expect the Company to stay
within the bounds of the commitment estimate in light of such changes beyond its
control.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
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REQUEST NO. 53: Please describe and provide the "assumed escalation
rates" as that term is used on page 5 of the Application. What costs are attributable to
the "assumed escalation rates
RESPONSE TO REQUEST NO. 53: As in the case of "legally required
equipment changes" referenced in Response to Request No. 52 , the reference to
assumed escalation rates" is intended to address circumstances that Idaho Power
cannot control. In the case of "assumed escalation rates " the best example is the
situation that occurred during the mid-1970's when rapidly increasing interest rates and
high inflation caused power plant equipment prices to increase very rapidly. Idaho
Power does not anticipate such changes in inflation and prices , but if such changes
were to occur, it would not be fair to require the Company to stay within the bounds of
the commitment estimate in light of such changes beyond its control. The escalation
rates used for purposes of evaluating the bids are contained in the materials located in
the discovery room.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 56: Please provide a copy of Idaho Power s credit
analysis of Mountain View Power, Inc. Please provide documentation of the credit rating
of Mountain View Power, Inc. as rated by Moody , Standard and Poor , Fitch , or other
rating agency.
RESPONSE TO REQUEST NO. 56: Mountain View Power, Inc. is too
small to be rated by any rating agency. Idaho Power is relying on the credit of Siemans-
Westinghouse Power Corporation and its parent, the Siemans Corporation, for the
credit support for this Project. Information concerning Sieman s credit is attached.
The Response to this Request was prepared by Jason Keil , Credit
Manager, IDACORP Risk Management, in consultation with Barton L. Kline , attorney for
Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 60: Please discuss any demand-side management
(DSM) alternatives considered as a means of minimizing or replacing the need for new
generation from the Bennett Mountain plant. What action has Idaho Power taken to
attempt to identify, quantify and price DSM alternatives?
RESPONSE TO REQUEST NO. 60: Idaho Power is continually analyzing
potential DSM programs as a means to reduce its costs of providing service. Idaho
Power has formed an Energy Efficiency Advisory Group (EEAG) made up of customers
Commission Staff and other stakeholders to assist the Company in selecting
appropriate , cost-effective DSM programs to receive funding from the energy efficiency
tariff rider. Some of the recent actions taken are described in the Responses to
Requests 61 and 62 below.
The Response to this Request was prepared by Maggie Brilz , Manager
Rate Design, Idaho Power Company, in consultation with Barton L. Kline , attorney for
Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 61: Please provide complete program descriptions of
Idaho Power s pilot residential air conditioner cycling program and its new irrigation
program. Discuss the status of these programs including participation levels , funding
commitments and future expansion plans. Describe how these programs reduce any of
the peak load that would otherwise have to be satisfied using the proposed Bennett
Mountain plant.
RESPONSE TO REQUEST NO. 61: The program descriptions for Idaho
Power Company s Pilot Residential Air Conditioner Cycling Program , Irrigation
Efficiency Program, and Industrial Efficiency Incentive Program are attached.
Pilot Residential Air Conditioner Cvclinq Proqram . The first year, or
season , of the Pilot Program concluded the end of August, 2003. During this first year
173 customers participated in the Pilot Program. The funding commitment for the two-
year Pilot Program is $810,000. A proposal to add a direct load control (DLC) switch
option to the program was presented to the Energy Efficiency Advisory Group (EEAG)
on October 22 2003. As a result of the EEAG's support for this option, the Company
plans to modify the Pilot Program to allow for an additional 200 program participants
during 2004. This program is a dispatchable load control program and as such is
designed to directly reduce peak load.
Irriqation Efficiencv Proqram . The Irrigation Efficiency Program was
launched on September 15 , 2003. At this time, nine projects have been submitted and
approved. It is anticipated that approximately 30 to 40 projects will be submitted and
approved by the end of 2003. On an ongoing basis , it is estimated that approximately
80 to 100 projects will be approved annually. The anticipated funding level for 2003 is
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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$200 000. For 2004 the anticipated funding level is $300 000. Any expansion of this
program is dependant on the availability of funds and volume of projects submitted by
customers. The program targets the installation of the minimum size pump, and
therefore installed kW , for both new systems and existing systems undergoing
modifications. It is not a dispatchable program. The impact on peak load results from
the fact that the installed kW operating at the time of peak is less that what was
previously or what would otherwise have been installed.
Industrial Efficiency Incentive Proqram . In addition to the Pilot Residential
Air Conditioner Cycling Program and the Irrigation Efficiency Program , the Company the
Industrial Efficiency Incentive Program on October 1 2003. The description for this
program is attached. This program targets efficiency improvements for customers with
loads of 500 kW or greater. The anticipated funding level for 2003 is $150 000. For
2004 the anticipated funding level is $500 000. Approximately 300 customers are
eligible to participate in this program. At this time, one project has been submitted and
is undergoing the final stages of approval. This program does not target peak load
reduction. However, to the extent that a project results in a reduction in the installed kW
and the equipment or process is operating at the time of the Company s peak, the
project could result in reducing peak load.
The Response to this Request was prepared by Maggie Brilz , Pricing
Director, Idaho Power Company, in consultation with Barton L. Kline and Monica B.
Moen , attorneys for Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 68: Please provide a complete description of any actual
or proposed energy or capacity sales to any other parties from the Bennett Mountain
plant. If no sales agreements have yet been made, when does Idaho Power expect to
make them?
RESPONSE TO REQUEST NO. 68: Idaho Power has not entered into
any sales agreements for any portion of the output of the Bennett Mountain Power
Plant. During the months when Idaho Power would not normally expect to utilize the
output of the Bennett Mountain Power Plant to serve native load , Idaho Power could
pursue the potential for such sales in the ordinary course of business.
The Response to this Request was prepared by Karl Bokenkamp, General
Manager, Power Supply Planning, Idaho Power Company, in consultation with Barton L.
Kline , Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 71: Please discuss whether there will be any implications
for Idaho Power s agreement with PPL Montana for 83 MW of firm power during heavy
Load hours as a result of Northwestern Energy s recent filing for Chapter 11 bankruptcy.
Does Idaho Power expect any difficulty with PPL Montana s ability to deliver, and if so
how does this affect Idaho Power s need for power.
RESPONSE TO REQUEST NO. 71: Idaho Power has discussed with
NorthWestern Energy the effect, if any, NorthWestern expects its Chapter
bankruptcy filing to have on its transmission agreements. Based on the discussions
with NorthWestern and based on independent review by outside bankruptcy counsel
Idaho Power does not anticipate that NorthWestern s bankruptcy filing will adversely
affect the Company s ability to receive the 83 MW purchased from PPL-Montana.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 72: Please provide all plans of both Idaho Power and
Mountain View Power relating to financing construction of the Bennett Mountain plant.
Please provide copies of any financing agreements.
RESPONSE TO REQUEST NO. 72: With respect to Idaho Power, see
Response to Request No. 55. Mountain View has advised Idaho Power that it has no
external financing plans, but instead is financing construction pursuant to the payment
provisions of the contract.
The Response to this Request was prepared by Barton L. Kline , Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 73: Does any financing arrangement of Idaho Power or
Mountain View hinge on the acceptance of the Idaho Public Utilities Commission
(IPUC) approval of Idaho Power s Application to rate base the plant? If so, provide a
copy of the pertinent document.
RESPONSE TO REQUEST NO. 73: Idaho Code , 9 61-526, requires that
before Idaho Power begins the construction of a power plant, it must first receive from
the Commission a certificate of public convenience and necessary. As a result, Idaho
Power will not issue a notice to proceed to Mountain View Power until the Commission
has issued a certificate of public convenience and necessity. Idaho Power is not aware
of any plans by Mountain View to construct the Bennett Mountain Power Plant as a
merchant plant if Idaho Power does not issue a notice to proceed.
The Response to this Request was prepared by Barton L. Kline , Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 74: If the IPUC does not approve Idaho Power
Application to rate base the plant , will Mountain View continue with the construction of
the Bennett Mountain plant?
RESPONSE TO REQUEST NO. 74: See Response to Request No. 73.
The Response to this Request was prepared by Barton L. Kline , Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 77: Please provide copies of all operational , financial and
any other reports made to members of Mountain View s managing partnership since the
inception of the company.
RESPONSE TO REQUEST NO. 77: Idaho Power does not have the
requested information. Idaho Power did require in its RFP that all bidders provide
audited financial statements and/or evidence of credit worthiness. Mountain View met
this requirement by substituting Siemens Westinghouse in its place as the credit worthy
entity supporting the bid and the project. See also Response to Request No. 56.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 78: Please provide copies of the year-end balance sheet
and income statements for Mountain View since its inception and a copy of the
statements through the second quarter of 2003. Provide a copy of Mountain View
general ledger for all accounts since its inception through the second quarter of 2003.
RESPONSE TO REQUEST NO. 78: Please see the Response to
Request No. 77.
The Response to this Request was prepared by Barton L. Kline , Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 81: Please provide a copy of any agreements or
contracts Mountain View has with the City of Mountain Home.
RESPONSE TO REQUEST NO. 81: Please see the Response to
Request Nos. 42 and 43.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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REQUEST NO. 82: Please provide copies of any permits Mountain View
has obtained with local , state or federal air, water, solid waste or land management
agencies. Please also summarize the status of all other permits that have not yet been
obtained but that will be necessary to construct the plant.
RESPONSE TO REQUEST NO. 82: Please see the Response to
Request Nos. 42 and 43.
The Response to this Request was prepared by Barton L. Kline, Senior
Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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DATED at Boise, Idaho , this 27th day of October, 2003.
BAR N L. KLINE
Attorney for Idaho Power Company
IDAHO POWER COMPANY'S RESPONSE TO FIRST
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CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 27th day of October, 2003, I served a
true and correct copy of the within and foregoing IDAHO POWER COMPANY'
RESPONSE FIRST PRODUCTION REQUEST OF COMMISSION STAFF upon the
following named parties by the method indicated below, and addressed to the following:
Donald L. Howell, II
Deputy Attorney General
Idaho Public Utilities Commission
P. O. Box 83720
Boise, Idaho 83720-0074
Hand Delivered
S. Mail
Overnight Mail
FAX
Peter J. Richardson
Richardson & 0' Leary
O. Box 1849
Eagle, Idaho 83616
Hand Delivered
S. Mail
Overnight Mail
FAX
Eric L. Olsen
Racine, Olson , Nye , Budge & Bailey
O. Box 1391
Pocatello, Idaho 83204-1391
Hand Delivered
S. Mail
Overnight Mail
FAX(j~ft~
BARTON L. KLINE
CERTIFICATE OF SERVICE
IPC- E-O3-
First Production Response of Idaho
Power to the Commission Staff
Attachments scanned as separate
document .....
also some attachments (i.e. leaflets)
cannot be scanned......
see case file for complete set
attachments to this 1 st Pro Response