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Home My WebLink About20090608IPC to Staff 85.pdfRECE,VEO 'PM It: 54 esIDA""POR~ An IDACORP Company BARTON L. KLINE Lead Counsel June 5, 2009 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-09-03 LANGLEY GULCH POWER PLANT Dear Ms. Jewell: Enclosed for filing are an original and three (3) copies of Idaho Power Company's Response to Staffs Production Request No. 85 of the Staffs Third Production Request to Idaho Power Company in the above matter. Very truly yours,&J~ Barton L. Kline BLK:csb Enclosures P.O. Box 70 (83707) 1221 W. Idaho St. Boise. 10 83702 BARTON L. KLINE, ISB #1526 LISA D. NORDSTROM, ISB #5733 Idaho Power Company P.O. Box 70 Boise, Idaho 83707 Telephone: 208-388-2682 Facsimile: 208-388-6936 bklinecæidahopower.com Inordstromcæidahopower.com RECEIVED 2009 JUH -5 PH~: 54 IDAHO PUBLIC 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 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 ) ) IDAHO POWER COMPANY'S ) RESPONSE TO THE THIRD ) PRODUCTION REQUEST OF THE ) COMMISSION STAFF TO IDAHO ) POWER COMPANY COMES NOW, Idaho Power Company ("Idaho Powet' or "the Company"), and in response to the Third Production Request of the Commission Staff to Idaho Power Company dated May 21, 2009, herewith submits the following information: IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 1 REQUEST NO. 85: In response to Request No. 20 of the Industrial Customers of Idaho Power, the Company stated that it is working on developing a new load forecast that wil be available in late summer of 2009. Given the significance of the proposed Langley Gulch project in terms of cost and added generation capacity, and given that the need for the Langley Gulch project was presumably based on a prior load forecast, please explain why Idaho Power has not prepared a more current load forecast. Can the load forecast update that is expected to be completed in late summer be expedited for use in the current Langley Gulch case? If so, please provide a copy of the revised load forecast. RESPONSE TO REQUEST NO. 85: There is no need to expedite the late summer 2009 sales and load forecast to confirm the need for Langley Gulch. Idaho Power has prepared a number of updated load forecasts since the 2006 IRP was published. The Company typically updates its load forecast annually. The September 2008 forecast was used for the 2009 IRP. Recent economic conditions prompted the Company to update the September 2008 load forecast in December of 2008 and then again in May 2009. The December 2008 update was discussed in the Company's Response to the Industrial Customers' Request No. 20. As noted in that Response, the residential and commercial class loads were updated. The most recent update, performed in May of 2009, updated the forecast loads for special contract customers as part of preparing the newest load forecast, which is expected to be completed in late summer 2009. Updating the forecast for special contract customers is one component of the complete load forecast update expected to be completed late this summer. The December 2008 and May 2009 forecasts were provided in the Company's Response to Staff Request No. 84. IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 2 As a result of these updates, the September 2008 "95th percentile" forecast of peak-hour load for July of 2009 through July of 2012, inclusive, (after accounting for expected performance of existing DSM programs) was dropped from 3,405 MW; 3,465MW; 3,543 MW; and 3,636 MW to 3,338 MW; 3,422 MW; 3,502 MW; and 3,608 MW, respectively. This translates into forecast peak-hour load reductions of 68 MW, 44 MW, 41 MW, and 28 MW for July of 2009-2012, respectively. The average energy forecast for July of 2009 through July of 2012 (after accounting for expected performance of existing DSM programs) was dropped from 2,457 MW; 2,494 MW; 2,543 MW; and 2,603 MW to 2,395 MW; 2,449 MW; 2,503 MW; and 2,577 MW, respectively. This translates into average energy reductions of 62 aMW, 44 aMW, 40 aMW, and 26 aMW for July of 2009 through July of 2012, respectively. In addition to incorporating the forecast peak-hour and average energy reductions noted above, the load and resource balances provided in the Company's Response to Staffs Request No. 84 have been updated to include all DSM program impacts as of May 2009, including new demand response programs for Irrigation, Commercial, and Industrial customers proposed in the 2009 IRP process. The total DSM contribution forecast for peak-hours during July of 2009 through July of 2012 is 185 MW, 261 MW, 332 MW, and 365 MW, respectively. On an average energy basis, the total DSM contribution forecast during July of 2009 through July of 2012 is 17 aMW, 33 aMW, 49 aMW, and 65 aMW. Utilizing the May 2009 load forecast, along with the forecast peak-hour DSM contributions and the assumed level of purchases from the Pacific Northwest, Idaho Power is stil projecting peak-hour deficits during July of 2009 through July of 2012 of 40 MW,21 MW,91 MW, and 183 MW, respectively. From an average energy perspective, IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 3 using the May 2009 load .forecast along with the forecast DSM contributions to reduce average energy requirements and the assumed level of purchases from the Pacific Northwest, Idaho Power is stil projecting average energy deficits during July of 2009 through July of 2012 of 397 MW, 418 MW, 465 MW, and 535 MW, respectively. Forecast average energy and peak-hour deficits are shown in the load and resource balances provided in the Company's Response to Staffs Request No. 84. However, these load & resource balances do not include 75 MW of recent July and August HL purchases at Mead (southern Nevada) for 2009,2010, and 2011. These purchases will utilize transmission on NV Energy's system and Idaho Powets transmission rights from Red Butte to Borah/Brady to deliver this energy to Idaho Powets east side on an as- needed basis. In spite of the fact that recent economic conditions have been very volatile, Idaho Power's load forecasts have been very accurate. The chart below ilustrates that accuracy. The chart below compares the December 2008 load forecast to the weather- adjusted actual loads for January, February, March, and April of 2009. Month Weather Adjusted December 2008 Difference (aMW) Actual Loads (aMW)Load Forecast (aMW)Dec minus WA Act January 2009 1,774 1,859 86 February 2009 1,683 1,714 31 March 2009 1,499 1,519 20 April 2009 1,445 1,504 59 The table shows that the absolute value of average difference between the weather adjusted actual and the December 2009 load forecast is approximately 50 aMW - with the December 2009 load forecast slightly exceeding weather-adjusted actual loads. The average difference (using absolute values) between the weather IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 4 adjusted actual loads and the forecast from January 2009 through April of 2009 is approximately 3 percent. Looking at the May 2009 load forecast, the weather-adjusted actual load for May was 13 aMW greater than the May 2009 forecast. In May of 2009, the load forecast was updated again, making specific adjustments to the load forecast for Idaho Powets special contract customers. In this update, the load forecast was reduced again, with the largest reductions (94 aMW and 97 MW during peak-hours) occurring in late 2009. This reduction at least partially offsets some of the approximately 50 MW of variance in the December 2009 forecast discussed above. As Staff noted in this Request, Idaho Power is currently in the process of updating the forecast again and the new forecast should be available late this summer. However, as described in the above discussion, significant deficits continue to be forecast for July of 2012 on both an average energy and peak-hour basis - even with hundreds of MWs of DSM anticipated in the forecast. Furthermore, in July of 2012, Power Supply plans to receive a 115 MW set-aside of firm network transmission to import purchases from the Pacific Northwest. Yet to meet peak hour loads, the Company is planning to import 315 aMW of energy from the Pacific Northwest during the same month. This means the majority of the planned imports wil be on Secondary Network (non-firm) transmission. Based on the Company's current projections, Langley Gulch, or another similarly sized resource, is needed in the 2012 timeframe to reduce the risk of a shortage of imported energy availability and wholesale market price risk. The resource need that the Langley Gulch project will meet was identified in the 20041RP. In the 2004 IRP, 500 MW of seasonal ownership coal-fired generation was identified for 2011. This was updated in the 2006 IRP, which included 250 MW of coal- IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 5 fired generation in 2013 and an additional 225 MW of transmission import capacity in 2012. The 2008 IRP Update included a 250 MW CCCT resource and the 225 MWof import capacity on the Hemingway-Boardman transmission line in 2012. The Boardman to Hemingway ("B2H") transmission line has been recently delayed until 2015. With the B2H project delayed, development of additional generation resources that do not utilze transmission capacity over the Company's constrained western interconnections, such as Langley Gulch, becomes even more important. Idaho Power will continue to work on updating its load forecast; however, it is important to recognize that the load forecast has been updated and that differences in weather-adjusted actual values from the forecast over that last few months have been about 50 MW on average, or about 3 percent. Idaho Powets load and resource balance incorporating the May 2009 load forecast, provided in the Company's Response to Staffs Request No. 84, indicates deficits significantly in excess of the recent 3 percent forecast differences. This coupled with the fact that (1) water conditions can be worse than planned for, (2) economic recovery could be faster than anticipated, and (3) Idaho Power stil relies on a significant amount of imports during the summer (a portion of which are imported on non-firm transmission), along with Idaho Power's obligation to serve, all indicate the need for additional internal generation resources. The persistence of the projected deficits through continued analysis, recent adjustments for the economic downturn, and increased DSM, underscores the need for rapid deployment of this needed resource. The response to this Request was prepared by Karl Bokenkamp, General Manager Power Supply Operations and Planning, Idaho Power Company, in consultation with Barton L. Kline, Lead Counsel, Idaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 6 DATED at Boise, Idaho, this 5th day of June 2009. ~- Attorney for Idaho Power Company IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 7 CERTIFICATE OF SERVICE I HEREBY CERTIFY that on this 5th day of June 2009 I served a true and correct copy of IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY upon the following named parties by the method indicated below, and addressed to the following: Commission Staff Scott Woodbury Deputy Attorney General Idaho Public Utilities Commission 472 West Washington P.O. Box 83720 Boise, Idaho 83720-0074 Industrial Customers of Idaho Power and Northwest and Intermountain Power Producers Coalition Peter J. Richardson, Esq. RICHARDSON & O'LEARY PLLC 515 North 27th Street P.O. Box 7218 Boise, Idaho 83702 Dr. Don Reading Ben Johnson Associates 6070 Hill Road Boise, Idaho 83703 Snake River Allance Ken Miler Snake River Alliance P.O. Box 1731 Boise, Idaho 83701 Idaho Irrigation Pumpers Association, Inc. Eric L. Olsen RACINE, OLSON, NYE, BUDGE & BAILEY, CHARTERED P.O. Box 1391 201 East Center Pocatello, Idaho 83204-1391 -- Hand Delivered U.S. Mail _ Overnight Mail FAX -- Email Scott.Woodburycæpuc.idaho.gov Hand Delivered -- U.S. Mail _ Overnight Mail FAX -- Email petercærichardsonandoleary.com Hand Delivered -- U.S. Mail _ Overnight Mail FAX -- Email dreadingcæmindspring.com Hand Delivered -- U.S. Mail _ Overnight Mail FAX -- Email kmillercæsnakeriverallance.org Hand Delivered -- U.S. Mail _ Overnight Mail FAX -- Email elocæracinelaw.net IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 8 Anthony Yankel Yankel & Associates, Inc. 29814 Lake Road Bay Vilage, Ohio 44140 Hand Delivered -- U.S. Mail _ Overnight Mail FAX -- Email tonyayyankel.net Idaho Conservation League Betsy Bridge Idaho Conservation League 710 North Sixth Street P.O. Box 844 Boise, Idaho 83701 Hand Delivered -- U.S. Mail _ Overnight Mail FAX -- Email bbridgeaywildidaho.org Northwest and Intermountain Power Producers Coalition Susan K. Ackerman 9883 NW Nottage Drive Portland, Oregon 97229 Hand Delivered -- U.S. Mail _ Overnight Mail FAX -- Email Susan.k.ackermanaycomcast.net Community Action Partnership Association Of Idaho Brad M. Purdy Attorney at Law 2019 North 1 ¡th Street Boise, Idaho 83702 Hand Delivered -- U.S. Mail _ Overnight Mail FAX -- Email bmpurdyayhotmail.com '- Barton L. Kline IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 9