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HomeMy WebLinkAbout20090325Staff 1-79 to IPC.pdfSCOTT WOODBURY DEPUTY ATTORNEY GENERAL IDAHO PUBLIC UTILITIES COMMISSION PO BOX 83720 BOISE, IDAHO 83720-0074 (208) 334-0312 IDAHO BAR NO. 1895 2U89 MAR 25 AM II: 21 Street Address for Express Mail: 472 W. WASHINGTON BOISE, IDAHO 83702-5983 Attorney for the Commission Staff BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF IDAHO POWER COMPANY'S APPLICATION FOR A CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY FOR THE LANGLEY GULCH POWER PLANT. ) ) CASE NO. IPC-E-09-03 ) ) FIRST PRODUCTION ) REQUEST OF THE ) COMMISSION STAFF TO ) IDAHO POWER COMPANY ) The Staff of the Idaho Public Utilities Commission, by and through its attorney of record, Scott Woodbury, Deputy Attorney General, requests that Idaho Power Company (Company; IPC) provide the following documents and information as soon as possible, but no later than FRIDAY, APRIL 10,2009. This Production Request is to be considered as continuing, and Idaho Power Company is requested to provide, by way of supplementary responses, additional documents that it or any person acting on its behalf may later obtain that wil augment the documents produced. For each item, please indicate the name of the person(s) preparing the answers, along with the job title of such person(s) and the witness who can sponsor the answer at hearing. Please provide answers to each question, supporting workpapers that provide detail or are the source of information used in calculations. The Company is reminded that responses pursuant to Commission Rules of Procedure must include the name and phone number of the FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 1 MARCH 25, 2009 person preparing the document, and the name, location and phone number of the record holder and if different the witness who can sponsor the answer at hearing if need be. Reference IDAP A 31.01.01.228. In addition to the written copies provided as response to the questions, please provide all Excel and electronic files on CD with formulas activated. REQUEST NO.1: Please provide a copy ofload-resource balance data by month for each of the years 2009-2029 for the following conditions: Energy analysis 50% water, 50% load Energy analysis 70% water, 70% load Energy analysis 90% water, 70% load Peak hour analysis 50% water, 50% load Peak hour analysis 70% water, 70% load Peak hour analysis 90% water, 70% load Please provide the data under two scenarios: a) without the addition of the Langley Gulch plant or any other new resources, and b) with the addition of the Langley Gulch plant. Please provide the data in an Excel format, both graphical and numericaL. REQUEST NO.2: Please explain and provide any other supporting documentation showing how the Company concluded that it should pursue development of a natural gas-fired CCCT located close to its Treasure Valley load center and that justified issuance of the 20 1 2 Baseload Request for Proposals (RFP). What water conditions were assumed in determining these energy and capacity needs? What load growth assumptions were assumed? REQUEST NO.3: The 2012 Baseload RFP sought proposals for dispatchable, first call, non-recallable, physically delivered firm or unit contingent energy commencing not later than June l, 2012. The Langley Gulch project, however, has a scheduled commercial operation date of December 1,2012. Please explain how the Langley Gulch project satisfies the RFP given its scheduled commercial operation date is six months later than required by the RFP. FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 2 MARCH 25, 2009 REQUEST NO.4: Please identify the possible "new large loads" locating within the Company's service territory that prompted the Company to revise its resource requirements. Bokenkamp Direct, p. 5, lines 3-4, 7-11. REQUEST NO.5: Please indicate whether the "anticipated shift in flow augmentation releases with water from the federal dams on the Snake River above Brownlee" have been formalized. Bokenkamp Direct, p. 5, lines 4-6. REQUEST NO.6: Please indicate whether any changes in load projections since the selection of Langley Gulch have accelerated or deferred the online date need for the resource. REQUEST NO.7: Please provide a list of representatives of potential bidders who attended the pre-bid meeting on May 8, 2008. REQUEST NO.8: Please provide a copy of all "Notice of Intent to Bid" forms completed and submitted to Idaho Power by interested bidders in the May 2008 RFP process. REQUEST NO.9: Please provide a copy of any evaluations, recommendations, or other correspondence from the independent consultant related to the 2012 Baseload RFP, the RFP evaluation criteria or the review and evaluation of bids. REQUEST NO. 10: Please provide copies of all bids received in response to the 2012 Baseload RFP. REQUEST NO. 11: Please provide a copy or complete description of all criteria used to evaluate bids received in the RFP, including the Evaluation ManuaL. REQUEST NO. 12: Is the Evaluation Manual used to evaluate bids for this RFP, including the breakdown between the number of points for price and non-price factors, any different than was used to evaluate bids for the Bennett Mountain project or the Danskin 1 project? If so, please explain the differences. Are the non-price factors considered in the FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 3 MARCH 25, 2009 evaluation any different than those considered in the Bennett Mountain or Danskin 1 RFPs? If so, please explain the differences. REQUEST NO. 13: Please provide copies of all analysis conducted by the Company in evaluating RFP bids. REQUEST NO. 14: Please provide a summar of the price (including separately the capital cost, transmission and interconnection costs, and plant operating costs) and non-price scores awarded to each of the bids, both in the initial screening and in the evaluation of short- listed bids. REQUEST NO. 15: Please provide analysis demonstrating that the Langley Gulch project was the preferred alternative for meeting Idaho Power's needs. REQUEST NO. 16: On June 25, 2008, an Addendum to the RFP was issued that reduced the proposal size to approximately 300 MW from its original size of250 to 600 MW. Please explain why this change was made and provide any related internal correspondence or memoranda. REQUEST NO. 17: Please indicate those bids eliminated in the "short listing" that occured during November 2008. Please state the reasons why each bid was eliminated. REQUEST NO. 18: Please provide, in a numerical format by year, a copy of any firm wholesale electric and natural gas price forecasts used in any of the analysis of bids received in the 2012 Baseload RFP. REQUEST NO. 19: Please explain in detail why Idaho Power did not have enough time to prepare a detailed design specification and release the RFP in time to meet the 2012 online date. In your response, please explain why the Company's Benchmark Resource development team had sufficient time to prepare a detailed bid, yet the Company's RFP team did not have sufficient time to prepare a detailed design specification for the RFP. FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 4 MARCH 25, 2009 REQUEST NO. 20: Does Idaho Power believe that by not allowing bids to be submitted for turney or build-and-transfer proposals, but allowing a self-build proposal to be submitted by its own Benchmark Resource development team, that it excluded potential projects from being bid that could have been superior to the self-build proposal? Please explain. REQUEST NO. 21: Does Idaho Power believe that a superior proposal to its own self- build proposal could have possibly been submitted if the Company had prepared detailed design specifications and allowed build-and-transfer proposals to be submitted? Please explain. REQUEST NO. 22: Was Idaho Power or any of its employees contacted by any entities desiring to submit turey or build-and-transfer bids? If so, how many entities made such contacts? Please provide all related correspondence or memoranda. REQUEST NO. 23: Please explain why Idaho Power believes" ...the evaluation process could become extremely complicated and somewhat subjective" (Bokenkamp Direct, p. 8, lines 3-4) if a build-and-transfer option was permitted, and whether such complications and subjectivity is less in comparing a self-build proposal to various PPA and TA proposals. Was this also the opinion ofR.W. Beck? Please provide all related correspondence or memoranda. REQUEST NO. 24: Referring to page 8, lines 10-16 of Karl Bokenkamp's direct testimony, how much time does Idaho Power believe it would have needed to prepare a detailed design specification had it decided to consider build-and-transfer options in the 2012 Baseload RFP? REQUEST NO. 25: IfIdaho Power believes it did not have time to prepare a detailed design specification in order to consider build-and-transfer options in the 2012 Baseload RFP, please explain why it did not star the process sooner. REQUEST NO. 26: If Idaho Power was able to delay the expected commercial operation of the Langley project from June 1,2012 to December 1,2012, why did the Company stil not have time to prepare detailed design specifications that would have been needed in order to allow build-and-transfer options in the 2012 Baseload RFP? FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 5 MARCH 25, 2009 REQUEST NO. 27: Please describe the selection process for engaging an independent third-pary to review the Company's RFP and bid evaluation process. REQUEST NO. 28: Please explain how Idaho Power compared power purchase agreement (PPA) and tollng agreement (T A) proposals to the Company's self-build proposal. Describe in detail any consideration that was given to advantages and disadvantages of financing, project operational control, project ownership, risk, ratemaking treatment, cash flow, actual vs. imputed debt, and other factors that distinguish a utility-owned asset from a PP A or TA. REQUEST NO. 29: Please identify the members ofIdaho Power's RFP evaluation team. REQUEST NO. 30: Please perform the following computer simulation rus for Idaho Power's system using the AURORA modeL. Before making any runs, however, review all assumptions for the transmission interconnections to Idaho Power's system, all assumptions for Idaho Power's existing generating plants, power purchase and sales contracts, load shape and any other necessary input assumptions and make any necessary adjustments so that the model corresponds as closely as possible to actual conditions. Insure that the load and fuel price forecasts assumed in the modeling rus are consistent with those of the 2008 IRP Update. It may be desirable to use the AURORA "Portfolio" feature to model Idaho Power for puroses of the following analyses. a. Perform an hourly simulation beginning December 1,2012, and extending through December 2037 (ruing five years beyond the conclusion of the period of interest as recommended by EPIS) under an operating mode in which no new capacity can be added within the Idaho Power system and supply deficiencies are met through power imports from outside Idaho Power's system. Based on the results of this run, identify the number and timing of any hours in which transmission constraints limit the amount of power that can be imported. In addition, identify those transmission interconnections on which constraints occur. Identify the timing and duration of any FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 6 MARCH 25, 2009 load curtailment predicted by the modeL. Report the results in graphical format, including any narative necessary to interpret the results. b. Perform a long-term optimization (capacity addition) study for the period December 1,2012 through December 2037. Use hourly dispatch to fully capture peak load hours. Confirm that the new resource choices available match those identified in the Company's 2008 IRP Update and that the Langley Gulch project is also available as a choice at the prices and terms assumed in the RFP analysis. Assume also that market purchases are an available option. Based on the results of this ru, identify the type, timing and location of new resources added along with the amount of capacity and energy associated with each new resource. Confirm whether the Langley Gulch project is chosen as an alternative to meet load. Summarize the months and the hours within each month when the Langley Gulch plant would be used to meet load. Identify any other resources selected by the modeL. c. Perform an hourly simulation beginning December 1, 2012, and extending through December 2037 assuming that capacity and energy is available in accordance with the Langley Gulch project but at zero cost. Compare the net power supply cost over the duration of the simulation to the net power supply cost for the model run conducted in par "b" above. Compare the difference in net power supply cost to the cost of the Langley Gulch project. REQUEST NO. 31: Please provide an electronic copy of all input and output fies used to perform the AURORA analysis requested in Staff Request No. 30. Please state the version of AURORA used. REQUEST NO. 32: Please describe any permits that wil be required for transmission system additions or improvements and provide time estimates of when such permits could be obtained. If any permits wil be required, what is their status? REQUEST NO. 33: Please describe the transmission constraints that made it desirable or necessary for Idaho Power to specify in the 2012 Baseload RFP that Idaho Power is interested in proposals that can provide electric capacity to the Treasure Valley load center. Provide copies FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 7 MARCH 25, 2009 of any analysis or transmission system studies in which these constraints were identified and described. REQUEST NO. 34: Please describe in detail any transmission system improvements, upgrades or additions that have recently been made or are planed in the general vicinity of the proposed Langley Gulch plant that are not contingent upon or considered a par of the Langley Gulch 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. REQUEST NO. 35: Please provide information supporting the transmission costs assumed by Idaho Power for each of the bids considered (Interconnection Feasibility studies, System Impact studies, etc.). Include cost assumptions, transmission losses, and any other transmission factors considered. REQUEST NO. 36: Please provide a copy of the System Impact Study prepared specifically for the Langley Gulch project. REQUEST NO. 37: Please provide estimates by month for the period December 2012 through December 2032 of the number of hours (or capacity factor) at which the Langley Gulch plant wil be expected to operate to serve Idaho Power's load. REQUEST NO. 38: Please provide estimates by month for the period December 2012 through December 2032 of the quantity of generation from the Langley Gulch plant that Idaho Power expects it will not need to meet its own load but will be able to sell off-system. Include estimates of the revenue associated with such sales. REQUEST NO. 39: Please provide a copy of any contracts/agreements signed by Idaho Power to secure fuel storage and transportation rights (i.e. transportation contracts) for the Langley Gulch project. What is the term of the contract(s)? What are the provisions for extending or renewing the agreements? For what period of time wil fuel transportation and FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 8 MARCH 25, 2009 storage be guaanteed? Do the contracts include fuel transporttion and storage for either the Danskin or the Bennett Mountain plants as well? REQUEST NO. 40: Has Idaho Power negotiated any agreements for the purchase of natural gas fuel supplies for the Langley Gulch plant? If so, please provide a copy of all such agreements. REQUEST NO. 41: Please describe the fuel procurement strategy Idaho Power intends to employ for the Langley Gulch plant. Discuss the following: a. term of likely agreements; b. quantity of fuel to be purchased on the spot market; and c. hedging strategies. REQUEST NO. 42: What is Idaho Power's forecast of expected fuel prices for the Langley Gulch plant for the next twenty-year period? Please provide forecasts in both a numerical and a graphical format. REQUEST NO. 43: Does Idaho Power have a risk management policy for acquiring natural gas fuel for any of its existing or planed gas-fired plants? If so, please provide a copy. If not, does the Company expect to develop a risk management policy? REQUEST NO. 44: For the proposed Langley Gulch plant, a. wil an additional fuel management contract be necessar, and b. wil there be sufficient fuel storage and transportation rights available without pipeline capacity expansions? REQUEST NO. 45: If the Langley Gulch project site can be expanded in the future, please identify any costs of the Langley Gulch project that wil be incured solely to enable additional capacity should it eventually be built at the Langley Gulch site, e.g., permitting, land acquisition, pipelines, pipeline capacity, fuel handling or storage, transmission, substations, interconnection, maintenance buildings or equipment, roads, site improvements, etc.? FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 9 MARCH 25, 2009 REQUEST NO. 46: Please describe and discuss any air quality attainment issues currently in place at the Langley Gulch site. Does Idaho Power expect any air quality attainment issues to restrict operation of the Langley Gulch plant in any way? Please provide copies of any studies done to evaluate air quality at the Langley Gulch site. REQUEST NO. 47: Please provide copies of any new permits Idaho Power has obtained with local, state or federal air, water, solid waste or land management agencies for the Langley Gulch site/project. Please also summarize the current status of all other permits that have not yet been obtained but that wil eventually be necessar for construction and operation of the plant. REQUEST NO. 48: Please describe and provide support for any assumptions made with regard to air quality attainment issues and/or operating restrictions for any of the project sites proposed by bidders. Please provide copies of any studies done to evaluate air quality at any proposed project sites. REQUEST NO. 49: Please describe and quantify all solid and liquid wastes that wil be produced by the plant. Explain how these wastes wil be treated or disposed of. Wil any additional on-site treatment facilities be necessary? REQUEST NO. 50: Please provide a detailed breakdown of the $427,400,000 Commitment Estimate for the Langley Gulch project, including workpapers and other documentation, showing categories such as major equipment, replacement pars, site improvements, substations, transmission improvements, fuel transportation, water treatment, sales taxes, AFUDC, the cost of Idaho Power oversight and inspection of the project, the cost of capitalized star-up fuel, etc. Where appropriate, show how the amounts have been computed and list any assumptions used to compute the amounts. In the breakdown, clearly identify those amounts that are considered contingencies. REQUEST NO. 51: Please describe any contractual (market) products that may be available that could provide capacity and energy comparable, or nearly comparable, to that FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 10 MARCH 25, 2009 which would be provided in the first five years of the Langley Gulch plant. Please provide the curent price for these products and identify the source from which the prices have been obtained. Please discuss how the Langley Gulch plant would be different, better, or worse than such products. REQUEST NO. 52: What is Idaho Power's curent forecast of expected firm wholesale electric energy prices for the next five and ten-year periods for heavy and light load hours? Please identify the source and date on which the forecasts were made. REQUEST NO. 53: Please discuss any demand-side management (DSM) alternatives considered as a means of minimizing or replacing the need for new generation from the Langley Gulch plant. What actions has Idaho Power taken to attempt to identify, quantify and price DSM alternatives? REQUEST NO. 54: Please provide complete program descriptions ofIdaho Power's DSM programs. Discuss the status of these programs including participation levels, funding commitments and future expansion plans. Describe how these programs reduce any of the load that would otherwise have to be satisfied using the proposed Langley Gulch plant. REQUEST NO. 55: Has Idaho Power considered any additional load management programs, rate designs or other strategies that could reduce the Company's peak load during those months and hours when the Langley Gulch plant is expected to operate? If so, does the Company have any specific plans to introduce such programs? Please provide copies of any reports, studies or analysis of any load management programs considered. REQUEST NO. 56: Has the Company implemented all of the DSM programs that have been identified as cost-effective in previous IRPs or studies of DSM potential? If not, please list and describe each of the programs that have not been implemented and explain why they have yet to be implemented. What are the potential energy and capacity savings estimates associated with each of these programs? FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 11 MARCH 25, 2009 REQUEST NO. 57: Did Idao Power consider converting the Danskin or Bennett Mountain plants to combined cycle as an alternative to the Langley Gulch plant? If so, please explain why that alternative was rejected and provide a copy of any analysis completed by Idaho Power justifying this decision. REQUEST NO. 58: Please discuss how the operation of the Company's other thermal plants (Danskin, Bennett Mountain, and coal plants) will change once the Langley Gulch plant becomes operationaL. Please provide numerical data showing the monthly difference in the amount of expected generation from the Danskin, Bennett Mountain, and coal plants with and without the Langley Gulch plant. REQUEST NO. 59: Please provide a complete description of any actual or proposed energy or capacity sales to any other parties from the Langley Gulch plant. If no sales agreements have yet been made, does Idaho Power expect to make them in the future? REQUEST NO. 60: Please discuss the status ofIdaho Power's plans to upgrade the Borah- West transmission path. Was an upgraded Borah-West transmission path assumed to be available in the evaluation ofRFP bids? Were transmission cost estimates for projects east of the Treasure Valley area less in the 2012 Baseload RPF than in previous thermal RFPs due to an assumed upgraded Borah-West transmission path? REQUEST NO. 61: Please discuss any plans Idaho Power has to issue additional RFPs in the next five years. What would be the timing of the RFPs and what type and size of resource would the Company be seeking? REQUEST NO. 62: Please provide an update on the status of the 2006 geothermal RFP. REQUEST NO. 63: Please discuss the status of Idaho Power's plans to upgrade the Shoshone Falls project. FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 12 MARCH 25, 2009 REQUEST NO. 64: Please describe how construction of the Langley Gulch plant will be financed. Include a summar of the payment schedule Idaho Power wil follow. Also include an estimate of AFUDC. Please provide copies of any financing agreements. REQUEST NO. 65: Please provide workpapers showing the computation of the AFUDC estimate discussed on page 12 of Karl Bokenkamp's testimony. REQUEST NO. 66: Please provide copies of the minutes of all Idaho Power Board of Directors meetings at which the Langley Gulch plant or any bids received in the 2012 Baseload RFP were discussed. REQUEST NO. 67: Has the Idaho Power Board of Directors authorized expenditure of fuds for construction of the Langley Gulch plant? REQUEST NO. 68: Please describe any additional costs Idaho Power expects it wil incur as a result of delaying completion of the project from June l, 2012 until December 1, 2012. REQUEST NO. 69: Please provide all information related to consideration, evaluation and raning of potential project sites by Idaho Power's Benchmark Resource Team. Please identify the sites considered and the factors considered in evaluating each site. Please include copies of any studies done to evaluate air quality at proposed sites. REQUEST NO. 70: Please provide copies of all reports, correspondence, and electronic communication between Power Engineers and Idaho Power's Benchmark Resource Team or any of its members related to preparation of the Benchmark Resource Team's project proposaL. REQUEST NO. 71: Please provide copies of all requests for proposals (RFPs) issued by the Benchmark Resource Team for key equipment components. REQUEST NO. 72: Please provide copies of all proposals or bids received in response to all RFPs issued by the Benchmark Resource Team for key equipment components. FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 13 MARCH 25, 2009 REQUEST NO. 73: Please provide a copy of the Request for Statement of Qualifications (RFQ) issued by the Benchmark Resource Team to identify potential contractors to perform EPC services. REQUEST NO. 74: Please provide copies of all responses to the RFQ issued by the Benchmark Resource Team. REQUEST NO. 75: Please provide all documentation related to evaluation of RFQs for EPC services and the selection of Kiewit and TIC. REQUEST NO. 76: Please provide a copy of the EPC contract with TIC/Kiewit once it is finalized. REQUEST NO. 77: Please provide copies of all contracts, leases, option agreements and memorandums of understading signed to date for engineering, procurement, construction, major equipment, fuel supply, fuel transport, land, water rights and any other thing needed to construct and operate the Langley Gulch project. REQUEST NO. 78: On page 20, lines 10-18 of Vern Porter's testimony, he discusses the Benchmark Resource Team's proposal regarding O&M and future capital expenditures. Please clarify whether the $500,000 per year for capital and maintenance improvements is included in the Commitment Estimate, and what the consequences wil be if actual O&M and capital expenditures exceed this amount. REQUEST NO. 79: For all intervenor requests, please provide the confidential responses to Staff even if the Company is unable to provide the information to that pary. FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 14 MARCH 25, 2009 DATED at Boise, Idaho, this ;¿5"1ay of March 2009. Technical Staff: Rick Sterling i:umisc:prodreq/ipce09.3swrps ipc i FIRST PRODUCTION REQUEST TO IDAHO POWER COMPANY 15 MARCH 25, 2009 CERTIFICATE OF SERVICE I HEREBY CERTIFY THAT I HAVE THIS 25TH DAY OF MARCH 2009, SERVED THE FOREGOING FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY, IN CASE NO. IPC-E-09-3, BY MAILING A COPY THEREOF, POSTAGE PREPAID, TO THE FOLLOWING: BARTON L KLINE LISA D NORDSTROM IDAHO POWER COMPANY PO BOX 70 BOISE ID 83707-0070 E-MAIL: bkline(Ðidahopower.com lnordstrom(Ðidahopower .com PETER J RICHARDSON RICHARDSON & O'LEARY 515 N 17TH STREET PO BOX 7218 BOISE ID 83702 E-MAIL: peter(Ðrichardsonandoleary.com DR DON READING 6070 HILL ROAD BOISE ID 83703 E-MAIL: dreading(Ðmindspring.com Jr~:b.~ SECRETARY CERTIFICATE OF SERVICE