20060815IPC to ICIP 1-10.pdf

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IDAHO POWER COMPANY
O. BOX 70
BOISE, IDAHO 83707
f~TON L KLINE
R E eEl \ sehior Attorney
August 15 , 2006
200& AUG '5 PH~: 45
IDAHO PUbLIC
UTILITIES COMM\SSIOr,
An IDACORP Company
HAND DELIVERED
Jean D. Jewell , Secretary
Idaho Public Utilities Commission
472 West Washington Street
P. O. Box 83720
Boise, Idaho 83720-0074
Re:Case No. I PC-06-
Petition For Modification of Load Growth Adjustment
Rate Within the Power Cost Adjustment Methodology
Dear Ms. Jewell:
Please find enclosed for filing an original and two (2) copies of Idaho Power
Company s Response to the First Production Request of the Industrial Customers of
Idaho Power regarding the above-referenced matter.
I would appreciate it if you would return a stamped copy of this transmittal letter
to me in the enclosed self-addressed stamped envelope.
Ve truly yours
BLK:sh
Enclosures
Telephone [phone], Fax [phone], E-mail BKlinerBIidahopower.com
RECEIVED
200& AUG 15 PH~:
BARTON L. KLINE ISB #1526
LISA D. NORDSTROM ISB #5733
Idaho Power Company
O. Box 70
Boise, Idaho 83707
Phone: [phone]
FAX: [phone]
bkline (g? idahopower.com
Inordstrom (g? idahopower.com
IOf-JiG PUbLIC
UTILITIES COMMISSION
Attorneys for Idaho Power Company
Express Mail Address
1221 West Idaho Street
Boise, Idaho 83702
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE PETITION OF
IDAHO POWER COMPANY FOR
MODIFICATION OF THE LOAD
GROWTH ADJUSTMENT RATE WITHIN THE POWER COST
ADJUSTMENT METHODOLOGY
CASE NO. IPC-06-
IDAHO POWER COMPANY'
RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF
IDAHO POWER
COMES NOW , Idaho Power Company ("Idaho Power" or "the Company ) and, in
response to the First Production Request of the Industrial Customers of Idaho Power to
Idaho Power Company dated July 18, 2006, herewith submits the following information:
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page
REQUEST FOR PRODUCTION NO.
On page 11 of Mr. Said's direct testimony, Mr. Said is asked: "In the original PCA
case, did the Company state a position regarding the appropriateness of the Staff-
proposed load growth adjustment rate?" Mr. Said responds
No. At the time the PCA was created, the Staff's proposed
marginal load growth adjustment rate seemed like a small
detail compared to the larger goal of establishing a PCA
mechanism.
Please provide all documentation and communications related to, and an explanation of
the company s contention that "at the time the PCA was created, the Staff's proposed
marginal load growth adjustment rate seemed like a small detail compared to the larger
goal of establishing a PCA mechanism.
RESPONSE TO REQUEST FOR PRODUCTION NO.
Mr. Said's statement that "at the time the PCA was created , the Staff's proposed
marginal load growth adjustment rate seemed like a small detail compared to the larger
goal of establishing a PCA mechanism" is based upon Mr. Said's review of the transcripts
in Case No. IPC-92-, his recollection of that case, and his verbal discussions with
other Company witnesses in the E-92-25 case about their recollection of that case.
When cross-examined by Commissioner Nelson in Case No. IPC-92-, Mr.
Said testified that Idaho Power Company s power supply expenses varied by over $100
million (Transcripts page 91Iines12-14). The Company proposed a Power Cost
Adjustment to adjust rates as power supply expenses varied. The Company s PCA
proposal included a forecast and a true-up component to each annual PCA rate. Issues
addressed in the case included forecast methodology, need for a true up, mechanism
gaming , deadbands, timing of adjustments, sharing, magnitude of PCA rate changes
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 2
interest computations, and load growth. As Mr. Said stated in his rebuttal testimony on
March 10 , 1993 , he first received Staff testimony regarding load growth on February 16,
1993. The Company had less than one month to review 199 pages of testimony and 35
exhibits to respond to load growth concerns as well as concerns over other PCA issues.
The Company s position on load growth was contained in Mr. Said's rebuttal testimony
which stated "The Company maintains that its proposed treatment of load growth is
appropriate." (Transcripts page 717 lines 9 and 10). As stated in Mr. Said's rebuttal
testimony, the Company was not able to provide in-depth analysis of counter proposals
nor was the Company able to address all of the potential combinations and permutations
of the various PCA features presented by other witnesses. (Transcripts page 698 , lines
20 through 26). It should also be noted that Idaho Power was not experiencing the rapid
load growth in 1992 that it is today.
The response to this request was prepared by Gregory W. Said, Manager
of Revenue Requirement, Idaho Power Company, in consultation with Barton L. Kline
Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 3
REQUEST FOR PRODUCTION NO.
As compared to a load growth adjustment methodology that uses predicted
marginal costs of serving load , does Idaho Power believe that a load growth adjustment
rate equal to the current embedded PCA-related cost of serving load operates as a
disincentive to Idaho Power for achieving conservation? Please explain why or why not.
RESPONSE TO REQUEST FOR PRODUCTION NO.
No. A load growth adjustment rate equal to the current embedded PCA-related
cost of serving load ensures that Idaho Power does not recover such costs twice. Mr.
Said's testimony on p. 12 explains why any load growth adjustment rate above embedded
levels creates a financial penalty for serving loads above test year levels. The Company
does not view a financial penalty for serving load to be equivalent to an incentive for
achieving conservation. The Company believes that the term "incentive" suggests a
benefit beyond simply recovering prudently incurred expenses.
The response to this request was prepared by Gregory W. Said , Manager of
Revenue Requirement, Idaho Power Company, in consultation with Barton L. Kline
Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 4
REQUEST FOR PRODUCTION NO.
On page 4 of Mr. Said's testimony, he states
The Company should be afforded a reasonable opportunity to
recover its PCA-related expenses associated with serving new
customer loads in a timely manner. The best way to do this is
to match the load growth adjustment rate to the Company
actual ability to recover its costs by using embedded costs to
determine the load growth adjustment rate.
Although Idaho Power believes that matching the load growth adjustment rate to
the embedded costs is , as explained above , the "best way" of affording the company to
recover its PCA-related expense associated with serving new customer loads , please
describe what lesser preferred methods the company could employ to try to recover its
PCA-related expenses associated with serving new customer loads.
RESPONSE TO REQUEST FOR PRODUCTION NO.
Idaho Power objects to this request on the grounds that the request calls for
speculation and requests a statement of opinion proscribed by RP 225.01 (a). Without
waiving these objections, it is the Company s position that the PCA mechanism is the
approved method for affording the Company a reasonable opportunity to recover its PCA-
related expenses associated with new customer loads. A load growth adjustment rate
within the PCA that is higher than the embedded cost included in base rates creates a
penalty for serving loads above test year levels and is therefore inconsistent with the
intent of the PCA.
The response to this request was prepared by Gregory W. Said , Manager of
Revenue Requirement, Idaho Power Company, in consultation with Barton L. Kline
Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 5
REQUEST FOR PRODUCTION NO.
On page 11 of Mr. Said's testimony, he states
It was only after some time had passed that the Company
came to realize the impacts of the penalty introduced by
setting the load growth adjustment at a marginal level rather
than an embedded level.
Please provide all documentation or communications on which the Company relied
in determining that a penalty was introduced by setting the load growth adjustment at a
marginal level rather than an embedded level.
RESPONSE TO REQUEST FOR PRODUCTION NO.
The nature of the penalty introduced by setting the load growth adjustment at a
marginal level rather that an embedded level is described in Mr. Said's testimony at page
12. The load growth adjustment rate represents a revenue credit applied against power
supply expenses. When revenue credits are intentionally set at a level that is likely to be
greater than the revenues received, a penalty occurs. The determination that marginal
power supply costs are greater than embedded power supply costs is documented in Mr.
Said's testimony.
The response to this request was prepared by Gregory W. Said , Manager of
Revenue Requirement , Idaho Power Company, in consultation with Barton L. Kline
Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 6
REQUEST FOR PRODUCTION NO.
On page 12 of Mr. Said's testimony, he describes the penalty that the Company
believes is produced by using a predicted marginal cost load growth adjustment as
opposed to an embedded cost load growth adjustment. In his description, he states "
the same time, the Company incurs additional costs associated with serving the additional
load. .." Please describe the additional costs the Company incurs "associated with
serving the additional load.
RESPONSE TO REQUEST FOR PRODUCTION NO.
The additional costs Mr. Said is referring to are incremental variable power supply
expenses such as additional fuel expenses , additional purchased power expenses
and/or reduced surplus sales revenues associated with serving additional load.
The response to this request was prepared by Gregory W. Said , Manager of
Revenue Requirement, Idaho Power Company, in consultation with Barton L. Kline
Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 7
REQUEST FOR PRODUCTION NO.
On page 12 of Mr. Said's testimony, he states "At the same time , the Company
incurs additional costs associated with serving the additional load. .." Does the Company
believe there are any economies of scale associated with the "additional costs" incurred in
serving additional load? Please explain fully your answer.
RESPONSE TO REQUEST FOR PRODUCTION NO.
Please see the Company Response to ICIP Request for Production No.5. The
Company believes there are no economies of scale related to incremental variable
power supply expenses.
The response to this request was prepared by Gregory W. Said , Manager of
Revenue Requirement , Idaho Power Company, in consultation with Barton L. Kline
Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 8
REQUEST FOR PRODUCTION NO.
On page 10 of Mr. Said's testimony, he states that "The Company believes that a
primary intent of the PCA is to allow rates to change annually to replace the normalized
PCA component of base rates with a PCA component reflective of current (actual) PCA
expenses." Please identify source of the company s belief described by Mr. Said, and
provide any documentation on which the Company bases this belief.
RESPONSE TO REQUEST FOR PRODUCTION NO.
Mr. Said was one of three Company witnesses in Case No. IPC-92-25. His
testimony in that Case was:
The primary objective of a Power Cost Adjustment should be to provide a simple
and understandable mechanism that closely matches revenues (resulting from rates) to
actual power supply expenses incurred by the Company." Mr. Said's current testimony is
consistent with his testimony in 1993 and with the Commission s rationale for approving
the Power Cost Adjustment mechanism as set forth by Order No. 24806.
The response to this request was prepared by Gregory W. Said, Manager of
Revenue Requirement, Idaho Power Company, in consultation with Barton L. Kline
Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 9
REQUEST FOR PRODUCTION NO.
On page 10 of Mr. Said's testimony, he states that "The Company believes that a
primary intent of the PCA is to allow rates to change annually to replace the normalized
PCA component of base rates with a PCA component reflective of current (actual) PCA
expenses." Does the company believe that there are lesser intents of the PCA (i.e. that
there are intents of the PCA that are secondary to the "primary" intent described by Mr.
Said)? If so , please explain fully.
RESPONSE TO REQUEST FOR PRODUCTION NO.
Idaho Power objects on the grounds that the request calls for speculation and
requests a statement of opinion proscribed by RP 225.01 (a). Without waiving these
objections, it is Idaho Power s belief that the concept of "sharing" was introduced into
PCA methodology with what Idaho Power Company believes was an intent to have both
the Company and its customers share in risks associated with PCA cost deviations from
base levels. As such , risk sharing establishes parameters around full movement toward
current PCA expense levels.
Likewise, the Company believes that the load growth adjustment rate was
introduced with the intent to eliminate the potential for double recovery of variable power
supply expenses.
The response to this request was prepared by Gregory W. Said , Manager of
Revenue Requirement, Idaho Power Company, in consultation with Barton L. Kline
Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 10
REQUEST FOR PRODUCTION NO.
On page 15 of Mr. Said's testimony, he states that "Non-QF expenses have
increased by $7 319.370. Non-QF generation has increased by 504 538 MWh. The
incremental rate for non-QF served load growth has been $14.51 per MWh." Please
provide the sources for all of the numbers set forth in this quotation from Mr. Said'
testimony, and provide all relevant documentation , calculations , and contracts. Also
please identify all plants that are included in the calculation of the increase in Non-
generation.
RESPONSE TO REQUEST FOR PRODUCTION NO.
The increase of $7 319 370 in non-QF expenses is the difference between Non-
QF expenses of $46 284 338 as determined in settlement of Case No. IPC-05-28 using
a 2005 test year and the equivalent 1993 value of $38 964 965 as determined through
Case Nos. IPC-96-, and IPC-98-05.
The 2005 test year settlement non-QF value of $46 284 338 is comprised of (1)
$47 179 800 of power supply expenses contained in Exhibit 4, page 1 of Case No. IPC-
05-10 (The Bennett Mountain Power Plant Case), (2) a $1 900 000 credit for cloud
seeding benefits as agreed by the parties to the settlement, and (3) $1 004 538 of cloud
seeding expenses as per Exhibit No. 22, page 1 of Case No. IPC-05-28. Page 1 of
Exhibit 4 in Case No. IPC-05-10 and page1 of Exhibit 22 in Case No. IPC-05-28 are
attached.
The 1993 test year non-QF expense computation is a bit more complex. In Case
No. IPC-96-5 normalized PCA expenses for test year 1993 were $68 567 558.
Subtracting $34 114 160 of QF expenses from the $68,567 558 of PCA expenses results
in $34,453 398 of power supply expenses. However, included in power supply expenses
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page
were $13 585 602 of FMC second block revenues which were reduced to $9 074 032 as
a result of an FMC contract change addressed in Case No. IPC-98-05. As a result
power supply expenses for PCA purposes effectively increased by $4 511 570
($13 585 602 - $9,074 032). Adding $4 511 570 to $34,453,398 results in $38 964 968.
Pages 3 and 4 of Mr. Said's testimony in Case No. IPC-96-5 and pages 3 and 4 of Mr.
Said's testimony in Case No. IPC-98-5 are attached.
The increase of 504 538 MWH of Non-QF generation was determined from
numbers contained in Mr. Said's testimony in this case. Load growth was quantified as
886 869 MWh at line 3 on page 14 of Mr. Said's testimony. QF growth was quantified as
382 331 MWh at line 17 on page 14 of Mr. Said's testimony. Load growth not served by
QF generation is served by Non-QF generation. Thus, 886 869 MWh of load growth less
382 331 MWh of QF growth results in 504 538 MWh of non-QF generation growth.
Please see the Response to ICIP Request for Production No.1 0 for details
regarding QF growth.
The $14.51 per MWh rate is derived by dividing $7 319 370 by 504 538 MWh.
The response to this request was prepared by Gregory W. Said , Manager of
Revenue Requirement , Idaho Power Company, in consultation with Barton L. Kline
Senior Attorney, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 12
REQUEST FOR PRODUCTION NO. 10:
On page 14 of Mr. Said's testimony, he states that "QF expenses have increased
by $20,517 997. QF generation has increased by 382 331 MWh. The incremental rate
for QF growth has been $53.67/MWh. Please provide the sources for all of the numbers
set forth in this quotation from Mr. Said's testimony, and provide all relevant
documentation , calculations, and contracts. Also , please identify all plants that are
included in the calculation of the increase in QF generation.
RESPONSE TO REQUEST FOR PRODUCTION NO.1 0:
In 1993, the Company established a normalized CSPP value of $34 114 160 for
purposes of the annual PCA filing. In the 2005 General Revenue Requirement case, the
Company updated the normalized CSPP value to $54 632 157. The workpapers
containing these values are attached.
The response to this request was prepared by Gregory W. Said , Manager of
Revenue Requirement, Idaho Power Company, in consultation with Barton L. Kline
Senior Attorney, Idaho Power Company.
DATED this day of August, 2006, at Boise, Idaho.
(lA1
BARTON L. KLINE
Attorney for Idaho Power Company
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 13
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this _th day of August, 2006 , I served a true and
correct copy of the within and foregoing Idaho Power Company s Response To The
First Production Request Of The Industrial Customers Of Idaho Power upon the
following named parties by the method indicated below , and addressed to the following:
Scott Woodbury
Deputy Attorney General
Idaho Public Utilities Commission
472 West Washington Street
Post Office Box 83720
Boise , Idaho 83720-0074
(X) U.S. Mail , Postage Prepaid
) Hand Delivered
) Overnight Mail
) Facsimile
(X) Email Scott.woodbury(g?puc.idaho.qov
Peter J. Richardson
Richardson & O'Leary PLLC
515 N. 2ih Street
Boise, Idaho 83702
(X) U.S. Mail, Postage Prepaid
) Hand Delivered
) Overnight Mail
) Facsimile [phone]
(X) Email peter(g? richardsonandoleary.com
William M. Eddie
Advocates for the West
O. Box 1612
Boise , Idaho 83701
(X) U.S. Mail , Postage Prepaid
) Hand Delivered
) Overnight Mail
) Facsimile
(X) Email billeddie
(g?
rmci. net
Nancy Hirsh
NW Energy Coalition
219 First Ave South, Suite 100
Seattle, Washington 98104
(X) U.S. Mail , Postage Prepaid
) Hand Delivered
) Overnight Mail
) Facsimile
) Email
Lawrence A. Gollomp
Assistant General Counsel
United States Department of Energy
1000 Independence Ave., SW
Washington, DC 20585
(X) U.S. Mail, Postage Prepaid
) Hand Delivered
) Overnight Mail
) Facsimile
(X) Email Lawrence.qollomp(g? hq.doe.qov
Dale Swan
Exeter Associates , Inc.
5565 Sterret Place, Suite 310
Columbia , MD 21044
(X) U.S. Mail , Postage Prepaid
) Hand Delivered
) Overnight Mail
) Facsimile
(X) Email dswan (g? exeterassociates.com
(W(U
Barton L. Kline
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO POWER - Page 14
IDAHO POWER COMPANY
CASE NO. IPC-O6-
FIRST PRODUCTION REQUEST
OF INDUSTRIAL CUSTOMERS
RESPONSE TO
REQUEST NO.
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1993 test year 2003 test year 2005 test year 2005 test year
+ Cloud Seeding
$73 079 128 $94 101 100 $106,607 357 $105 904 180
$48 039 000 $47 688,100 $51 975 200 $51 975 200
$34 114 160 $46,413 000 $54,632 157 $54,632,157
074 032 n/a
n/a n/a 004 538 Idaho Cloud Seeding
n/a n/a 707 715 $1,607 616.
$73 079,128 $94 101 100 $106 607 357 $105,904 180
COMPUTATION OF
PCA FACTORS
Normalized PCA expense computation
Normalized PCA expenses
Normalized Power Supply expenses
Normalized CSPP
FMC revenues
Cloud Seeding expenses
Cloud Seeding revenues
Net
Normalized Base PCA rate computation
Normalized System Firm Load
Normalized System Firm Sales
Expense Adjustment Rate for Growth
Valmy Fuel Rate
Boardman Fuel Rate
Average
13,952 283 MWh
863,484 MWh 13,497 550 MWh
5238 7315 7898
952,283 MWh 107,573 MWh 819 152 MWh
781 660 MWh 275 009 MWh 13,950 521 MWh
84.4%94.94.
20.14.
12.13.
16.13.
819,152 MWh
13,950 521 MWh
94.
13,497 550 MWh
Normalized Base PCA rate (centsIkWh)7846
Idaho Jurisdictional Percentage computation
Normalized System Firm Load
Idaho Jurisdictional Firm Load
Idaho Jurisdictional Percentage
EXHIBIT NO. 22
CASE NO. IPC-O5-
G. SAID, IPC
PAGE 1 OF 1
des ign Adjustment which would impactPowerCost
customers' rates based upon changes in the Company's net
power supply expenses.I presented my recommendations to
the Idaho Public utilities Commission in 1992 at which
time the Commission established the Power Cost Adjustment
as an annual adjustment to the Company's rates.
In 1994, I was asked to become the Meridian
Distr ict one year cross-trainingforManager
opportuni ty .In 1995 , I returned to my position in the
Ra te Department.
What is the projection of PCA expenses for
April 1, 1996 through March 31, 1997?
The projection of PCA expenses for April
1996 through 1997March methodunderthe
computation approved by the Commission is $49 311,493.
This amount is $19 256 065 lower than the $68 567 558
normalized level of PCA expenses adopted in Case No. IPC-
E-95-5,the requirementCompany'last revenue
determination by the Commission.
What is the basis for the projection of
April 1 , 1996 through March 31 , 1997 PCA expenses?
The Commission, in Order No. 24806 which
implemented natural logarithmictheadoptedPCA,
function of projected April through July Brownlee runoff
to compute the projection of April through March PCA
SAID , Di
Idaho Power Company
\ ~c..- E.- ~ (0"" S
The derivation of the current equation isexpenses.
contained on Exhibit 1.The current equation is:
PCA expense = $1,023 185 930
63,236 861 * (In (runoff))
34,114 160
585 602
In this formula $34 114 160the is the Qualifying
Facilities ("QF") purchase expense , and the $13 585 602
is the normalized FMC secondary sales revenue.
The National Weather Service River Forecast
Center, in its April 1 forecast , projected April through
July Brownlee runoff to be 6.75 million acre feet.
Inserting this value into the adopted equation results in
a projection of net PCA expenses of $49 311 493 for the
per iod Apr i 1 1996 through March 31 1997.The
information supplied by the National Weather Service is
contained on Exhibit 2.The Brownlee Reservoir inflow
appears at the bottom of page 1 of Exhibit
You have stated that the projected net PCA
expenses are less than the normalized level of PCA
expenses by $19,256 065.What is the rate adjustment
associated with the decreased PCA expenses
$49 311,493?
From Case No. IPC-E-95-5, the normalized
PCA expense of $68 567 558 , divided by the normalized
SAID , Di
Idaho Power Company
\ ~ (.-E.-q!o- S
...'--"------
Because of my combined Resource Planning
Department and Rate Department experience, I was asked
design a Power Cost Adjustment which would impact
customers rates based upon changes in the Company'
net supplypower presentedexpenses.
recommenda ti ons the Idaho Public Utili ties
Commission 1992 which time the Commission
established the Power Cost Adjustment annual
adjustment to the Company rates.
1994,was as ked become the
Meridian District Manager for a one year cross-training
opportuni ty .In 1995, I returned to my position in the
Rate Department.In October 1996,I was promoted to
lead team analysts the newly reorganized
Pricing Regulatory Services Department,formerly
known as the Rate Department.
What is the proj ection of PCA expenses for
April 1, 1998 through March 31, 1999?
The projection of PCA expenses for April
1998 through March 31, 1999 is $75,646,228.This
amount 078,670 greater than the $68,567,558
normali zed level PCA expenses adopted Case No.
IPC-E-95-5,the Company last revenue requirement
determination by the Commission.
SAID, Di
Idaho Power Company
\~L""E.- C)~-
What is the basis for the proj ection
April 1, 1998 through March 31, 1999 PCA expenses?
The Commission, in Order No. 24806 issued
in Case No. IPC-E-92-25, the proceeding which created
the PCA,adopted functionnaturallogarithmic
proj ected April through July Brownlee runoff to compute
the proj ection of April through March PCA expenses.
The derivation of the current equation is contained on
Exhibit Qualifying Facili ties QF" )purchase
expense and normalized FMC second block energy revenue
are constants which thehavebeenincluded
proj ection computation.The current equation is:
PCA expense =$1,023,185,930
-$63,236,861* (In (runoff))
$34 114,160
$9,074,032
In this formula,the $34,114,160 is the QF purchase
expense,and FMCthe$9,074,032 normali zedthe
second block of energy revenue established by the new
FMC contract.
Why have you used the energy revenue from
the second block of the new priorFMCcontract
Commission approval of that contract?
There currently pending before the
Commi.sion, Case No. IPC-E-97-13, a proceeding for the
SAID, Oi
Idaho Power Company
\~C-c.-'7Q-G
IDAHO POWER COMPANY
CASE NO. IPC-06-
FIRST PRODUCTION REQUEST
OF INDUSTRIAL CUSTOMERS
RESPONSE TO
REQUEST NO.
2/
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