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Home My WebLink About20070228IPC to Staff 1-5.pdf;-:::=Ci, :!' " IDAHO~POWER~ An IDACORP Company 7(;n~"of) r,.... I.Ijll "1:.1 ,::'0 r"1'j J: 4b Barton L. Kline Senior Attorney ; - - I li:Y:J),Uj~!:;I :';~~. J j I~i 11c::;~) "i:vi/0;;:dU, February 28, 2007 Jean D. Jewell , Secretary Idaho Public Utilities Commission 472 West Washington Street P. O. Box 83720 Boise, Idaho 83720-0074 Re:Case No. IPC-07- In the Matter of Idaho Power Company Petition to Revise the Published Avoided Cost Rates to Include a daily Load Shape; and To Clarify the Rules governing Entitlement to Published Avoided Cost Rates 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 Commission Staff for the above-referenced matter. I would appreciate it if you would return a stamped copy of this transmittal letter in the enclosed self-addressed, stamped envelope. Barton L. Kline BLK:sh Enclosures O. Box 70 (83707) 1221 W. Idaho St. Boise, ID 83702 BARTON L. KLINE, ISB # 1526 MONICA B. MOEN , ISB # 5734 Idaho Power Company 1221 West Idaho Street O. Box 70 Boise, Idaho 83707 Telephone: (208) 388-2682 FAX Telephone: (208) 388-6936 bkline (Q) idahopower.com mmoen (Q) idahopower.com Attorneys for Idaho Power Company Express Mail Address 1221 West Idaho Street Boise, Idaho 83702 CE:! . 20G1FEB~:8 P\-13:49 UTt L ~D~- :': d~~;.:?/:i js I (j. BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF IDAHO POWER COMPANY'S PETITION TO REVISE THE PUBLISHED AVOIDED COST RATES TO INCLUDE A DAILY LOAD SHAPE; AND TO CLARIFY THE RULES GOVERNING ENTITLEMENT TO PUBLISHED AVOIDED COST RATES CASE NO. IPC-07- IDAHO POWER COMPANY' ) RESPONSE TO THE FIRST ) PRODUCTION REQUEST OF THE ) COMMISSION STAFF COMES NOW, Idaho Power Company ("Idaho Power" or "the Company ) and , in response to the First Production Request of the Commission Staff to Idaho Power Company dated February 20,2007, herewith submits the following information: IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF, Page REQUEST FOR PRODUCTION NO.1: Please provide, in Excel spreadsheet in electronic format, the raw data used to compute the weighted heavy and light load hour Mid-Columbia prices as shown on page 1 of Attachment 1 to the Company s Application. RESPONSE TO REQUEST NO.1: The requested information is enclosed. The response to this request was prepared by Randy Allphin, Administrator Power Supply, Idaho Power Company, in consultation with Barton Kline, Senior Attorney, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF, Page 2 REQUEST FOR PRODUCTION NO.2: Please provide , in Excel spreadsheet in electronic format, a copy of the spreadsheets attached as pages 3-6 of Attachment 1 to the Company s Application. RESPONSE TO REQUEST NO.2: The requested information is enclosed. The response to this request was prepared by Randy Allphin, Administrator Power Supply, Idaho Power Company, in consultation with Barton Kline , Senior Attorney, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF, Page 3 REQUEST FOR PRODUCTION NO.3: With regard to the proposed "Definition of a Small Power Production Facility Eligible to Receive Published Rates " what rate would be paid to a facility that fails part way through the term of its power sales agreement to maintain its eligibility? How would such a rate be determined? RESPONSE TO REQUEST NO.3: Loss of eligibility to receive the published rates would be a breach of the Firm Energy Sales Agreement (FESA). It is hard to see how the loss of eligibility after an initially eligible project had been in operation for a period of time could be an inadvertent breach on the part of the QF. As a result, Idaho Power believes that the likelihood of a breach due to a violation of the proposed definition is low. That being said, in the event of such a future breach and assuming the PURPA mandatory purchase obligation continues, there may be multiple ways for Idaho Power to determine the remedy that should be applied, how damages would be measured and what is the appropriate purchase rate after the breach. Without precluding any other reasonable method for setting future purchase rates, one approach that could be followed when a FESA is breached is as follows: When Idaho Power has determined that a breach of the FESA has occurred and the QF has failed to cure the breach as provided in the FESA, the Company could utilize the IRP methodology to determine the costs the Company can avoid by continuing to make purchases from the breaching QF under the FESA. If the avoided costs determined using the IRP methodology are lower than the rate contained in the FESA, the FESA would be terminated. If the IRP methodology shows that avoided costs for the remaining term of the FESA are higher than the rate in the FESA, Idaho Power could require the QF to continue to perform the FESA without change to the rate. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF, Page 4 Following FESA termination if a PURPA purchase obligation remains , an appropriate future purchase rate would depend on the then-approved avoided costs rate setting methodology. Subsequent purchase rates following FESA termination might be based on market prices, the results of RFPs, newly established published rate avoided cost rates or rates developed by using the IRP methodology. The response to this request was prepared by Barton L. Kline, Senior Attorney, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF, Page 5 REQUEST FOR PRODUCTION NO.4: If the proposed "Definition of a Small Power Production Facility Eligible to Receive Published Rates" had been in place in the past, would any projects that now have power sales agreements have been precluded from obtaining them under the proposed definition? If so , which ones? RESPONSE TO REQUEST NO.4: It is impossible to apply the proposed definition to all QFs currently under contract because ownership information for some current QFs is not available to Idaho Power. Idaho Power currently has approximately 90 Firm Energy Sales Agreements FESAs ) with QFs. The vast majority of the FESAs are for small hydro, cogeneration wind and biomass projects. In reviewing the list of current FESAs, with the exception of the 18 FESAs for QF wind projects, and with the ownership information that is currently available, Idaho Power believes that the proposed definition would not have precluded receipt of a FESA for any other projects. Because Idaho Power is not privy to the ownership data that would be required to apply the new definition to the wind FESAs, the Company cannot say for certain that some existing wind developments might have been precluded from obtaining contracts under the proposed definition.Of course, if the definition had been in place before the 18 wind FESAs were signed, Idaho Power expects that the wind QFs could have been structured to avoid any problem with the definition. The response to this request was prepared by Randy Allphin , Administrator Power Supply, Idaho Power Company, in consultation with Barton Kline , Senior Attorney, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF, Page 6 REQUEST FOR PRODUCTION NO.Are there any pending power sales agreements (i.e., those that are at some stage in the negotiation process) that might be affected by the proposed "Definition of a Small Power Production Facility Eligible to Receive Published Rates If so which ones. RESPONSE TO REQUEST NO.5: No. The response to this request was prepared by Randy Allphin, Administrator Power Supply, Idaho Power Company, in consultation with Barton Kline, Senior Attorney, Idaho Power Company. Respectfully submitted this 28th day of February 2007. Barton L. Kline Attorney for Idaho Power Company IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF, Page 7 CERTIFICATE OF SERVICE I HEREBY CERTIFY that on this 28th day of February 2007, I served a true and correct copy of the within and foregoing 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 Exergy Development Group of Idaho, LLC c/o Peter J. Richardson Richardson & O'Leary, PLLC 515 N. 2ih Street O. Box 7218 Boise, Idaho 83702 Dr. Don Reading 6070 Hill Road Boise, Idaho 83703 ) U.S. Mail , Postage Prepaid (X) Hand Delivered ) Overnight Mail ) Facsimile (X) Email scottwoodbury(Q)puc.idaho.Qov (X) U.S. Mail , Postage Prepaid ) Hand Delivered ) Overnight Mail ) Facsimile (X) Email peter(Q) richardsonandoleary.com (X) U.S. Mail , Postage Prepaid ) Hand Delivered ) Overnight Mail ) Facsimile (X) Email dreadinQ (Q) mindsprinQ.com IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF, Page 8