HomeMy WebLinkAbout20081014IPC to ICIP 45-51.pdfBARTON L. KLINE
Lead Counsel
~IDA.~POR~
An IDACORP Company
October 10, 2008
VIA HAND DELIVERY
Jean D. Jewell, Secretary
Idaho Public Utilities Commission
472 West Washington Street
P.O. Box 83720
Boise, Idaho 83720-0074
Re: Case No. IPC-E-08-10
General Rate Case
Dear Ms. Jewell:
Enclosed for filing please find an original and three (3) copies each of Idaho Power
Company's Second Supplemental Response to the Sixth Production Request of the
Commission Staff, Idaho Power Company's Response to the Fourth Production RêqLJesföf
the Industrial Customers, Idaho Power Company's Response to Community Action
Partnership Association of Idaho's First Production Requests, and Idaho Power Company's
Response to the Seventh Production Request of the Commission Staff.
In addition, also enclosed are CDs containing the Company's responses to
production requests in which electronic/excel files were requested and also for ease of
production of the information.
Upon receipt of this filing, I would appreciate it if you would return a stamped copy of
this letter for my file in the enclosed stamped, self-addressed envelope.velJ/&:
Barton L. Kline
Lead Counsel for Idaho Power Company
BLK:csb
Enclosures P.O. Box 70 (83107)
1221 W. Idaho St.
Boise, ID 83702
BARTON L. KLINE, ISB #1526
LISA D. NORDSTROM, ISB #5733
DONOVAN E. WALKER, ISB #5921
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
Telephone: (208) 388-2682
Facsimile: (208) 388-6936
bkline~idahopower.com
InordstromØlidahopower.com
dwalkerØlidahopower.com
RECEIVED
2008 OCT 10 PM 5: 04
IDAHO PUSLlC
UTILITIES COMMiSSION
Attorneys for Idaho Power Company
Street Address for Express Mail:
1221 West Idaho Street
Boise, Idaho 83702
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE
APPLICATION OF IDAHO POWER
COMPANY FOR AUTHORITY TO
INCREASE ITS RATES AND
CHARGES FOR ELECTRIC
SERVICE.
) CASE NO. IPC-E-08-10
)
)
)
)
)
)
IDAHO POWER COMPANY'S
RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF IDAHO
POWER
COMES NOW, Idaho Power Company ("Idaho Powet' or "the Company"), and in
response to the Fourth Production Request of the Industrial Customers of Idaho Power
Company dated September 26, 2008, herewith submits the following information:
IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 1
REQUEST FOR PRODUCTION NO. 45: In Idaho Power Company's Response
to the First Production Request to Commission Staff NO.9 the Company stated, "A wind
integration cost cap of $6.50 was established in Case No. IPC-E-07-03. If this cap were
used, it is estimated that Idaho Power would incur nearly $3.5 Millon in wind integration
costs." Does Idaho Power believe it is in fact incurring $3.5 Millon in costs currently
from both CSPP wind projects and its own Elkhorn Wind project that is not currently
being passed on to ratepayers? Please explain fully.
RESPONSE TO REQUEST FOR PRODUCTION NO. 45: Idaho Power is
currently incurring the costs of integrating the CSPP and Elkhorn wind projects into the
system. Those costs are not reflected in the power supply modeling contained in the
Company's General Rate Case Application. The costs of integrating wind projects into
the system include hourly operational impacts that are not easily captured in AURORA
modeling, such as the need for standby generation from Company resources and
increased purchased power expenses, while reducing surplus sales. Thes e costs
should be included in base rates. If the costs are not reflected in base rates, they wil
be recovered through the PCA on a shared basis.
This response to this Request was prepared by Scott Wright, Pricing Analyst,
and Gregory W. Said, Idaho Power Company, Manager of Revenue Requirement, in
consultation with Barton L. Kline, Lead Counsel, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 2
REQUEST FOR PRODUCTION NO. 46: In Idaho Power Company's Response
to the First Production Request to Commission Staff No.5, the Company provided a list
of PURPA projects (CONFIDENTIAL) signed but not yet operating. Please, for this
same list, provide the expected MW and MWh for each project.
RESPONSE TO REQUEST FOR PRODUCTION NO. 46: This confidential
response to this Request was prepared by Randy Allphin, Power Supply Planning
Senior Administrator Idaho Power Company, in consultation with Barton L. Kline, Lead
Counsel, Idaho Power Company, and is being provided pursuant to the Protective
Agreement.
IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 3
REQUEST FOR PRODUCTION NO. 47: In Idaho Power Company's Response
to the Third Production Request to ICIP No. 37 the Company states, "Attached in a Fuel
Cost Calculation workbook used to calculate the 20-Year Levelized Dispatch
Costs/MWh. Please provide the workbook and supporting workbooks in electronic form.
RESPONSE TO REQUEST FOR PRODUCTION NO. 47: Please see the Fuel
Cost Calculation workbook used to calculate the 20-Year Levelized Dispatch
Costs/MWh, provided in electronic format on the enclosed CD.
This response to this Request was prepared by Courtney Waites, Pricing
Analyst, Idaho Power Company, in consultation with Barton L. Kline, Lead Counsel,
Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 4
REQUEST FOR PRODUCTION NO. 48: In Idaho Power Company's Response
to the Third Production Request to ICIP No. 37 the workbook provided uses "Max hours
run per year" in the analysis of 400 hours. Please explain fully the answer to each of
the following:
a. Does the Company assume the 400 hours is for each generator or is it for
some combination of generation sites?
b. What is the number of sites, and total MWexpected by the Company
should the program be implemented?
c. Has the Company do any analysis as to the number of hours it would
expect emergency generators would actually be run should the program be
implemented?
d. In the analysis did the Company consider using emergency generators as
reserves that would be used to meet its reserve requirements?
e. Please provide a copy of any analysis referred to in responding.
RESPONSE TO REQUEST FOR PRODUCTION NO. 48:
a. In the Fuel Cost Calculation provided by Idaho Power in response to
Request No. 37 of the Third Production Request of the Industrial Customers, the
Company assumes 400 hours of run time for a customets generator to come up with a
cost per MWh. The cost per MWh is then compared to the cost per MWh of a simple
cycle combustion turbine plant.
b. Because the program is stil in the research and design phase, the
Company did. not get commitment from customers as to whether or not they would be
wiling to participate in the virtual peaker program. However, we are aware of at least
IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 5
40 MW of existing generation that could potentially participate. In addition, a few
customers expressed interest in adding generation in the future.
c. The Company has not done any analyses as to the number of hours it
would expect emergency generators would actually be run should a program be
implemented. However, the Company did look at the number of hours the emergency
generators would have been run had a program been in place during the last few years.
Using a variable fuel expense of $342.46/MWh, it would theoretically have been
economically feasible to dispatch emergency diesel generators on July 24,2006 from
12 PM to 8 PM and on July 25, 2006 from 11 AM to 8 PM. Wholesale power was
purchased real time during these hours at $350/MWh and $350-$385/MWh
respectively.
d. The Company has considered using emergency generators to meet
reserve requirements although the potential value of the reserves were not incorporated
into the financial analysis.
e. Other than the analyses already provided, no further analyses have been
performed.
This response to this Request was prepared by Courtney Waites, Pricing
Analyst, Idaho Power Company, in consultation with Barton L. Kline, Lead Counsel,
Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 6
REQUEST FOR PRODUCTION NO. 49: This Request is asking for reconciling
various natural gas forecast used in the current case.
a. In Idaho Power Company's Response to the Third Production Request to
ICIP No. 37 the Company states it used the 2007 Northwest Power and Conservation
Council's 2007 gas forecast in it Virtual Peaker Levelized Cost Analysis.
b. In Idaho Power Company's Response to the First Production Request to
Commission Staff No. 5 provided natural gas data used in Idaho Power's AURORA
modeL.
c. The 2008 Marginal Cost Analysis filed with witness Tatum's workpapers,
page 47 states the Marginal Cost of Energy was found using power supply runs using
Globallnsigtit 30-year Utility Natural Gas Index.
d. The 2008 Marginal Cost Analysis filed with witness Tatum's workpapers,
page 47 the loads and resources we from taken from the Company's 2006 IRP that was
based on a different methodology.
Please compare each of the natural gas forecasts described in a through d
above and provide an explanation why a variety of natural gas forecasts were used in
the analysis for a this single rate case.
RESPONSE TO REQUEST FOR PRODUCTION NO. 49: Item (a) is not related
to items (b)-(d) as it is not part of this current case. The gas expense used for the
Virtual Peaker Levelized Cost Analysis was taken from the 2007 Northwest Power and
Conservation Council's 2007 median case forecast because it is an independent data
source that has been used for planning analyses and evaluations.
IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 7
Items (b)-(d) in the above requests are all related. Idaho Powets natural gas
price forecast, item (b), was developed for the 2008 Test Year and then escalated using
the Global Insight 30-year Utility Natural Gas Index for the Marginal Cost Analysis, item
(c). According to Mr. Tatum's workpapers, the reference to the load and resources
taken from the 2006 IRP is a separate sentence and is not related to the development
of a natural gas price forecast. The next sentence in Mr. Tatum's workpapers states,
"The 2008 test year gas prices were used, adjusted for each of the years using the
Utility Natural Gas Index from the Global Insight 30-year US Economic Outlook,
February 2008." Therefore, item (d), is related to the original gas price forecast
developed as item (b).
This response to this Request was prepared by Courtney Waites, Pricing
Analyst, and Scott Wright, Pricing Analyst, Idaho Power Company, in consultation with
Barton L. Kline, Lead Counsel, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 8
REQUEST FOR PRODUCTION NO. 50: In Company witness Nemnich's direct
testimony, page 35, she states,
When time-of-use rates were implemented for Schedule 19
customers four years ago, the differentials between On-
Peak, Mid-Peak, and Off-Peak Energy Charges were set at
an "introductory" leveL. By increasing the rate differentials, a
stronger price signal is sent that wil provide a stronger
incentive to conserve or to shift the time of energy usage to
a less costly time period. This stronger price signal provides
higher benefits to those customers who modify operations or
purchase equipment that uses less energy.
a. Please provide any analysis and studies that the Company preformed that
indicate the price response and elasticity for Schedule 19 customers to increasing the
differentials in rates proposed for Schedule 19.
b. Please provide any analysis and studies that the Company preformed that
indicate the costs for Schedule 19 customers would incur in shifting their energy
demand to take advantage of the differentials in rates proposed for Schedule 19.
RESPONSE TO REQUEST FOR PRODUCTION NO. 50:
a. Please see Idaho Power's response to Staffs production Request No. 45.
b. While the Company, through its energy effciency programs, does have
significant information about the costs and/or benefits to customers to conserve energy
and demand, the Company does not collect information on the costs customers may
incur when they shift energy in response to time-of-use rates.
The response to this Request was prepared by Darlene Nemnich, Senior Pricing
Analyst, Idaho Power Company, in consultation with Barton L. Kline, Lead Counsel,
Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 9
REQUEST FOR PRODUCTION NO. 51: The Company is proposing an increase
of 70.5% in the Summer On-Peak Demand Change for Schedule 19 customers going
from the current $0.44 to $0.75 (Exhibit 74, page 5 of 10). Please provide any analysis
or studies the Company has undertaken that would indicated (sic) the response it
expects from this rate increase.
RESPONSE TO REQUEST FOR PRODUCTION NO. 51: Idaho Power has not
conducted any formal analysis or study to evaluate the response to this rate increase.
This response to this Request was prepared by Darlene Nemnich, Senior Pricing
Analyst, Idaho Power Company, in consultation with Barton L. Kline, Lead Counsel,
Idaho Power Company.
DATED at Boise, Idaho, this 10th day of October 2008.
"
BART L. KLINE
Attorney for Idaho Power Company
LISA D. NORDSTROM
Attorney for Idaho Power Company
DONOVAN E. WALKER
Attorney for Idaho Power Company
IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 10
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 10th day of October 2008 I served a true and
correct copy of IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER
upon the following named parties by the method indicated below, and addressed to the
following:
Commission Staff
Weldon B. Stutzman
Deputy Attorney General
Idaho Public Utilities Commission
472 West Washington
P.O. Box 83720
Boise, Idaho 83720-0074
Neil Price
Deputy Attorney General
Idaho Public Utilties Commission
472 West Washington
P.O. Box 83720
Boise, Idaho 83720-0074
Industral Customers of Idaho Power
Peter J. Richardson, Esq.
RICHARDSON & O'LEARY PLLC
515 North 2ih Street
P.O. Box 7218
Boise, Idaho 83702
Dr. Don Reading
Ben Johnson Associates
6070 Hil Road
Boise, Idaho 83703
Idaho Irrigation Pumpers
Association, Inc.
Randall C. Budge
Eric L. Olsen
RACINE, OLSON, NYE, BUDGE &
BAILEY, CHARTERED
P.O. Box 1391
201 East Center
Pocatello, Idaho 83204-1391
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IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 11
Anthony Yankel
Yankel & Associates, Inc.
29814 Lake Road
Bay Vilage, Ohio 44140
Kroger Co. I Fred Meyer and Smiths
Michael L. Kurt
Kurt J. Boehm
BOEHM, KURTZ & LOWRY
36 East Seventh Street, Suite 1510
Cincinnati, Ohio 45202
The Kroger Co.
Attn: Corporate Energy Manager (G09)
1014 Vine Street
Cincinnati, Ohio 45202
Kevin Higgins
Energy Strategies, LLC
Parkside Towers
215 South State Street, Suite 200
Salt Lake City, Utah 84111
Micron Technology
Conley Ward
Michael C. Creamer
GIVENS PURSLEY, LLP
601 West Bannock Street
P.O. Box 2720
Boise, Idaho 83701-2720
Dennis E. Peseau, Ph.D.
Utility Resources, Inc.
1500 Libert Street SE, Suite 250
Salem, Oregon 97302
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IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 12
Department of Energy
Lot R. Cooke
Arthur Perr Bruder
Offce of the General Counsel
United States Department of Energy
1000 Independence Avenue SW
Washington, DC 20585
Routing Symbol GC-76
Dwight D. Etheridge
Exeter Associates, Inc.
5565 Sterrett Place, Suite 310
Columbia, MD 2104
Community Action Partnership
Association Of Idaho
Brad M. Purdy
Attorney at Law
2019 North 1ih Street
Boise, Idaho 83702
Snake River Allance
Ken Miler
Snake River Allance
P.O. Box 1731
Boise, Idaho 83701
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IDAHO POWER COMPANY'S RESPONSE TO THE FOURTH
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER -13