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HomeMy WebLinkAbout20141001IPC to ICL 1-7.pdfS!ffi*. An IDACORP Company DONOVAN E. WALKER Lead Gounsel lircIi\11[: ?nlrj 0CT - | PH h: 37 i[.iAt-i'-; iii.r i; .i' I :l ll_l-il i:S ;-lC.'i' 1 rljSi t",i+ October 1,2014 VIA HAND DELIVERY Jean D. Jewell, Secretary ldaho Public Utilities Commission 472 West Washington Street Boise, ldaho 83702 Re: Case No. IPC-E-14-22 Confirmation of Use of Capacity Deficit in lRP Methodology - ldaho Power Company's Response to the First Production Request of the ldaho Conservation League Dear Ms. Jewell: Enclosed for filing in the above matter are an original and three (3) copies of ldaho Power Company's Response to the First Production Request of the ldaho Conservation League. Also enclosed are four (4) confidential disks containing information responsive to the ldaho Conservation League's production requests. DEW:csb Enclosures '122 1 W. ldaho 5t. (83702) PO. Box 70 Boise, lD 83707 DONOVAN E. WALKER (lSB No. 5921) ldaho Power Company 1221West ldaho Street (83702) P.O. Box 70 Boise, ldaho 83707 Telephone: (208) 388-5317 Facsimile: (208) 388-6936 dwal ker@ idahopower. co m Attorney for ldaho Power Company !N THE MATTER OF THE APPLICATION OF IDAHO POWER COMPANY FOR CONFIRMATION OF THE CAPACITY DEFICIENCY PERIOD FOR INCREMENTAL COST, INTEGMTED RESOURCE PLAN, AVOIDED COST METHODOLOGY. F. =C r: iVi: lr ?0lq OCT - | Pll L: 37 lililX,j itL, ':.." r... L!T I LlTl i: 3 i:C l'.ti,1 ISS i Uil BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. |PC-E-14-22 IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVATION LEAGUE COMES NOW, ldaho Power Company ("ldaho Powe/' or "Compo[y"), and in response to the ldaho Conservation League's ("!CL") First Production Request to ldaho Power dated September 19,2014, herewith submits the following information: IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVATION LEAGUE - 1 REQUEST NO. 1: Please reference page 7 of ldaho Power's Application, which states: ln addition, ldaho Power currently has just over 529 MW of proposed new solar QF projects seeking pricing and contracts. Of this 529 MW, eight proposed projects (just over 208 MW) had previously received initial indicative pricing that included capacity payments for the entire term of the contract sent prior to the Commission's July 2021 first capacity deficit determination. Each of these projects has received superseding and updated indicative pricing runs with the capacity portion of the rates removed through June of 2021. a. Please provide a list of each of the solar projects included in the 529 MW of proposed new solar QF projects that includes; i. Name of the project ii. Nameplate MW iii. Location of the Project iv. Estimated on-line date b. Please indicate which of the above-proposed projects are the eight that received initial indicative pricing along with the initial avoided cost of energy and the capacity payment offered to the QF. RESPONSE TO REQUEST NO. 1: a. Please see the confidential PDF provided on the confidentia! CD. b. Please see the confidential PDF provided on the confidential CD. ln addition, please see the confidential Excel file provided on the confidential CD for the pricing. The confidential CD will be provided to those parties that have executed the Protective Agreement in this matter. The response to this Request is sponsored by Randy C. Allphin, Energy Contracts Coordinator Leader, ldaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVATION LEAGUE - 2 REQUEST NO. 2: Please reference pages 7 and 8 of ldaho Power's Application, which states: The difference in avoided cost rates for those eight projects that received revised indicative pricing is approximately $65 million. The difference in price for all 529 MW of proposed solar projects is just about $170 million. Please provide all workpapers, spreadsheets, and documents used to calculate the $65 million cost of the eight projects and the $t ZO million cost for all of the 529 MW proposed solar projects. RESPONSE TO REQUEST NO. 2: The eight projects referenced in ICL's Request equate to approximately 208 megawatts ("MW") of nameplate rating. The cafculated $6.3 million average for a 20 MW project (please see confidential Exce! file provided on the confidential CD) times 208 MW equals the approximated value of $65 million as contained within ldaho Powe/s Application. The same base was applied to the 529 MW of proposed projects. The $6.3 million average for a 20 MW applied to 529 MW of proposed solar projects equals approximately $166 million, which was rounded to $170 million and included in ldaho Powe/s Application. The confidential CD will be provided to those parties that have executed the Protective Agreement in this matter. The response to this Request is sponsored by Randy C. Allphin, Energy Contracts Coordinator Leader, ldaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FTRST PRODUCTION REOUEST OF THE IDAHO CONSERVATION LEAGUE - 3 REQUEST NO. 3: Based on Idaho Powe/s representations, submitted Apri! 29, 2014, the Commission found the Company had enrolled 403 MW of demand response capacity across three programs for the summer of 2014. Order No. 33084 at 4 - 5. For Apri! 2014 through August 2014, please provide for each of the three demand response programs the actual MW reduction, the dates each program was dispatched, and the duration of the dispatch. RESPONSE TO REQUEST NO. 3: ldaho Power dispatched the lrrigation Peak Rewards program three times this program season. Each event split the participants in four groups, each experiencing a four hour duration. The groups were dispatched either 2-6 p.m., 3-7 p.m., 4-8 p.m., or 5-9 p.m. The preliminary estimate of total MW reduction was 286 MW on July 2;294 MW on July 10; and 275 MW on July 14 during the 5-6 p.m. hour on each date when each of the groups overlapped. ldaho Power dispatched the A/C Coo! Credit program three times this program season. Each event's duration was three hours from 4-7 p.m. The preliminary estimate of total MW reduction was 43 MW on July 14;33 MW on July 31; and 35 MW on August 11. ldaho Power dispatched the Flex Peak Management program three times this program season. Each event's duration was four hours from 4-8 p.m., except on August 13 the event time was 3-7 p.m. The preliminary estimate of total MW reduction was 32 MW on July 2;32 MW on July 13; and 25 MW on August 14. The response to this Request is sponsored by Pete Pengilly, Customer Research and Analysis Leader, ldaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVATION LEAGUE - 4 REQUEST NO. 4: Please reference ldaho Powe/s Application at page 4, where the Company describes the capacity deficiency resulting from Case No. IPC-E-13-21. a. Please confirm or deny if ldaho Power represented in that docket that when including 440 MW of demand response the first capacity deficient was 36 MW in July of 2021. b. Please confirm or deny if ldaho Power represented in that docket that without demand response programs ldaho Power forecast a 414 MW capacity deficient in July of 2020. c. Please explain whether ldaho Power's confirmed demand response capacity of 403 MW is sufficient to meet the forecast 414 MW of deficiency in July of 2020. d. Please describe ldaho Powe/s ability to retain at least 403 MW of demand response capacity each year throughout the 20-year IRP forecast period. RESPONSE TO REQUEST NO. 4: a. Table 3 on page 4 of ldaho Power's Application in Case No. IPC-E-13-21 shows a first capacity deficit of 36 MW in July of 2021, with a notation in the table heading stating, "2013 IRP with October 2013 Load and September 2013 CSPP Forecasts and Demand Response up to 440 MW." b. Table 2 on page 3 of ldaho Powe/s Application in Case No. IPC-E-13-21 shows a capacity deficit of 414 MW in July of 2O2O, with a notation in the table heading stating, "2013 IRP with October 2013 Load and September 2013 CSPP Forecasts." c. ldaho Power is not sure what the Request means by referencing "ldaho Power's confirmed demand response capacity of 403 MW.' However, ldaho Power's Petition for Reconsideration of Order No. 33016 in Case No. IPC-E-13-21 states on IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVATION LEAGUE - 5 page 8, "As of April 24, 2014, ldaho Power has DR program participants enrolled to provide a maximum load reduction at generation level of approximately 403 MW'(citing to White Direct, p.7). With regard to meeting a projected 414 MW capacity deficit in July of 2020, the Commission's final order on reconsideration, Order No. 33084, states: Based on the Company's demonstrated demand response program participation, as well as the factors considered in final Order No. 33016 (lRP, updated load forecast, updated natural gas forecast, new and terminated PURPA contracts and long-term power purchase agreement), we find it fair, just and reasonable for the Company to utilize July 2021 as the capacity deficiency date to be used in the Company's SAR methodology. Order No. 33084, p. 5. d. As referenced on pages 3 through I of ldaho Powe/s Petition for Reconsideration of Order No. 33016 in Case No. IPC-E-13-21, ldaho Power's Demand Response Settlement Agreement from Case No. IPC-E-13-14 requires the Company to take all demand response up to approximately 440 MW. Unless this requirement is subsequently modified, ldaho Power will accept all demand response up to that level as required. lt is possible that actual levels of demand response could vary from year to year over "the 20-year IRP forecast period" as referenced in Request for Production No. 4.d-actual amounts could be less, or could be more. However, as quoted in Response to Request No. 4.c above, the ldaho Public Utilities Commission in Order No. 33084 found it fair, just, and reasonable to accept the Company's forecast of demand response and capacity deficiency as shown in Table 3 on page 4 of ldaho Powe/s Application in Case No. IPC-E-13-21. The response to this Request was prepared by Donovan E. Walker, Lead Counse!, ldaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVATION LEAGUE - 6 REQUEST NO. 5: Has ldaho Power experienced any erosion in the participation rate of any of the three DR programs over the summer of 2014? lf so please indicate which program and the degree of the erosion in terms of megawatts and participants or service points. RESPONSE TO REQUEST NO. 5: Although ldaho Power does not know exactly how ICL would define erosion in participation rate over the summer of 2014, the Company will provide information for each program for the summer of 2014. lt is important to note that in accordance with the settlement agreement executed in Case No. IPC-E-13-14, ldaho Power is not actively marketing any of the three demand response programs. The lrrigation Peak Rewards program had 2,239 participating service points on June 15 and 2,233 on August 15 with a maximum expected reduction of 319 MW during the peak of the irrigation season, estimated to be the last week of June. The six service locations that terminated participation represented a potential load reduction of 500 kilowatts and withdrew because of irrigation system or crop issues that influenced the decisions to participate at those locations. For the three dispatch events during the summer on July 2, 10, and 14, ldaho Power had 20, 66, and 28 temporary opt-outs of service locations respectively due to various reasons, such as soi! moisture, labor, cultivation, fertilizer, or chemical applications. ln the A/C Coo! Credit program, the number of active participants on June 15 was 30,345 (31,539 devices), which represents an expected MW reduction potential of 34.5 MW. The number of active participants as of August 18 was 29,544 (30,707 devices), which represents an expected MW reduction potential of 33.6 MW. ln this IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVATION LEAGUE. T time period, some participants ended participation in the program either by request or by moving and other participants joined the program either through recruiting customers who moved into a home with an existing device or because they heard about the program through other means. For the FlexPeak Management program, Idaho Power did alter the agreement with EnerNOC, lnc., for the program in 2014 (Case No. IPC-E-14-02). However, the Company did not reduce the allowable achievable MW in 2014. The maximum, minimum, and average generation-level nomination in 2014 with 94 participating sites was 32.9, 31.1, and 28.1 MW, respectively. The response to this Request is sponsored by Pete Pengilly, Customer Research and Analysis Leader, ldaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVATION LEAGUE - 8 REQUEST NO. 6: ldaho Power's 2013 lntegrated Resource Plan, on page 36, states the Company "is planning on the additional capacity from the Shoshone Falls upgrade being available in 2019". Please provide any documentation establishing that the Shoshone Falls upgrade will in fact be online in 2019 and provide the expected MW of additional capacity. For example, please provide copies of any permits or other approvals received, water rights secured, and economic analysis completed. RESPONSE TO REQUEST NO. 6: ln ldaho Power's 2013 lntegrated Resource Plan ("lRP"), the Shoshone Falls Upgrade Project ("Project") was treated as a committed resource coming on-line in 2019. While the economic analysis of the Project shows it being beneficial, the Project only provides an additional 2 MW of capacity in the month of July under the 90th percentile IRP water planning criterion. Therefore it does little to offset the need for other resources that are able to serve customers' summer peak needs. On May 19, 2014, ldaho Power was granted an extension from the Federal Energy Regulatory Commission ("FERC') modifying the deadline to complete construction until July 1 ,2022. After the 2013 IRP was filed at the end of June 2013, ldaho Power completed an updated cost-benefit analysis of the Project assuming a July 1, 2022, completion date. This analysis is provided in the confidential spreadsheet, Shoshone Falls Upgrade Cost-Benefit Analysis, provided on the confidential CD. Please note the natural gas (NG) price forecast cases used were the same as the cases considered for the 2013 IRP (p. 0Z of the 2013 IRP). The confidential CD will be provided to those parties that have executed the Protective Agreement in this matter. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REOUEST OF THE IDAHO CONSERVAT]ON LEAGUE - 9 For the 2015 IRP, ldaho Power will update the economic analysis of the Project. The FERC order granting an extension of time and the Permit to Appropriate Water issued by the State of ldaho are attached hereto. The response to this Request is sponsored by Phil DeVol, Resource Planning Leader, ldaho Power Company. IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVATION LEAGUE - 1O REQUEST NO. 7: Please refer to page 61 of ldaho Powe/s 2013 lntegrated Resource Plan, which states the Company includes existing energy efficiency into the peak-hour load and resource balance. a. Please confirm whether ldaho Powe/s actual energy efficiency savings in 2014 match the forecasted energy savings for 2014 included in the load and resource balance. lf actual and planned saving do not match please indicate whether actual loads were higher or lower than forecast. b. Please provide the capacity contribution of energy efficiency programs for each year of the peak-hour load and resource balance in the 2013 lRP. RESPONSE TO REQUEST NO. 7: a. Idaho Power objects to ICL's Request No. 7 as Case No. IPC-E-14-22 deals with the effect of including demand response programs in the capacity deficiency determination. Additionally, because 2014 has not ended, the requested information is not available. b. On pages 53-72 in the lRP, Appendix C, ldaho Power includes the peak hour load reduction by month from its energy efficiency programs on five rows: (1) Existing DSM (EE), 2013lRP DSM (EE), (2) lrrigation, (3) Commercial, (4) Residential, and (5) Total New DSM Peak Reduction. lRP, Appendix C can be found at: http://www. puc. idaho.qov/fileroom/cases/summarv/elec. html . The response to this Request is sponsored by Pete Pengilly, Customer Research and Analysis Leader, ldaho Power Company. DATED at Boise, ldaho, this 1't day of 2014. DONOVAN E. WALKER Attorney for ldaho Power Company IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REOUEST OF THE IDAHO CONSERVATION LEAGUE - 11 CERTIFICATE OF SERVICE I HEREBY CERTIFY that on the 1" day of October 2014 I served a true and correct copy of IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVATION LEAGUE upon the following named parties by the method indicated below, and addressed to the following: Commission Staff Kristine A. Sasser Deputy Attomey General ldaho Public Utilities Commission 472 West Washington (83702) P.O. Box 83720 Boise, ldaho 83720-007 4 Idaho Gonservation League Benjamin J- Otto ldaho Conservation League 710 North 6th Street Boise, ldaho 83702 lntermountain Energy Partners, LLC Dean J. Miller McDEVITT & MILLER LLP 420 West Bannock Street (83702) P.O. Box 2564 Boise, ldaho 83701 Leif Elgethun, PE, LEED AP lntermountain Energy Partners, LLC 1775 State Street (83702) P.O. Box 125 Boise, ldaho 83701 X Hand Delivered U.S. Mai! Ovemight Mail FAXX Email kris.sasser@puc.idaho.oov Hand DeliveredX U.S. Mail Ovemight Mail FAXX Email botto@idahoconservation.oro _Hand DeliveredX U.S. Mail _Overnight Mail _FAXX Email ioe@mcdevitt-miller.com _Hand DeliveredX U.S. Mail _Overnight Mail FAX Emair .ry IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE IDAHO CONSERVAT]ON LEAGUE- 12 Christa Bearry, Lega! Assistant BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION cAsE NO. IPC-E-14-22 IDAHO POWER COMPANY RESPONSE TO ICL'S REQUEST NO. 6 20140519-3028 FERC PDF (Unofficial) 0s/1,9/201,4 UNITED STATES OF AMERICA FEDERAL ENERGY REGULATORY COMMISSION Idaho Power Company Project No. 2778-035 ORDER GRANTING EXTENSION OF TIME (Issued May 19, 2014) 1. On April 8,zll4,Idaho Power Company, licensee for the Shoshone Falls Hydroelectric Project, FERC No. 2778, requested a subsequent extension of time to commence and complete construction of project works authorized by an Order Amending License and Revising Annual Charges.l The project is located on the Snake River in Jerome and Twin Falls Counties,Idaho and occupies 1.98 acres of federal lands managed by the U.S. Department of the lnterior's Bureau of Land Managernent. Background 2. The amendment order authorized the removal of powerhouse sections that contain the licensee's current 0.4-MW and 0.6- MW generating units, and the construction of a new powerhouse section containing a single 50-MW generating unit, spillway, intake gate and hoist, and additional structures. 3. Article 306 of the amendment order requires the licensee to commence construction or installation of project works within two years from issuance and complete construction or installation of such works within three years from issuance. The Commission may terminate the authority granted by the amendment order if the licensee fails to commence actual construction of the project works authorized within the time prescribed or as extended by the Commission. The licensee was granted a prior extension2 to commence and complete construction of the authorized work until July, 1, 2014 and July 1,2018, respectively. ' t32 rERC fl 62,001, issued July 01, 2010. 2 Unpublished Order Granting Extension of Time, issued May l, 2012. 20140519-3028 FERC PDF (Unofficial) 05/1,9/20L4 Project No. 2778-035 Discussion 4. The licensee states in their filing that they been reviewing the project costs and economic viability of the Shoshone Falls Project expansion. They state that there has been uncertainty in their generation requirements created by the lower prices of alternatives resources, decline in population growth, and the change in water conditions. Based on their review the licensee believes that it is appropriate to defer commencement of construction of the newpowerhouse and switchyard for four additional years to allow for clarification of these issues. However, the licensee will start construction of the new spillway, intake gate and hoist, and additional structures prior to July 1,2014. The licensee is requesting an extension of time until July l, 2018, to commence construction and until July l, 2022 to complete construction of the powerhouse and switchyard under Article 306. 5. The reasons advanced by the licensee are reasonable and justiff the extension of time. The additional time will allow the licensee to resolve the uncertainties associated with the project upgrade. The licensee is reminded that in the event it does not move forward with the construction of the powerhouse and switchyard, the term of the license3 will not be extended as outlined in ordering paragraph (B) of the amendment order. The Director orders: (A) The deadline to commence and complete construction of the new power house and switchyard pursuant to Article 306 of the Order Amending License and Revising Annual Charges for the Shoshone Falls Hydroelectric Project is extended to July 1,2018 and July 1, 2022, respectively. (B) This order constitutes final agency action. Any party may file a request for rehearing of this order within 30 days from the date of its issuance, as provided in section 313(a) of the FPA, 16 U.S.C. $ 825/ (2012), and the Commission's regulations at l8 C.F.R. $ 385.713 (2014). The filing of a request for rehearing does not operate as a stay of the effective date of this order, or of any other date specified in this order. The failure to file a request for rehearing shall constitute acceptance of this order. Charles K. Cover, P.E. Chiel Project Review Branch Division of Hydropower Administration and Compliance 2 3 Order Issuing New License, 108 FERC n6l,l25,issued August 4,2004 Page 1 State of ldaho Department of Water Resources Permit to Appropriate Water NO.2-{0325 Priority: October 03, 2006 Maximum Diversion Rate: 3,850.00 CFS This is to certify, that IDAHO POWER CO PO BOX 70 BO|SE tD 83707 has applied for a permit to appropriate water from: Source: SNAKE RIVER Tributary: COLUMBIA RIVER and a permit is APPROVED for development of water as follows: BENEFtctAL USE PEBIOD OF USE RATE OF DIVERSION POWER 01/01 to 12131 3,850.00 CFS LOCATION OF POINT(S) OF DIVERSION: SNAKE RIVER Lg (NW%SW%) Sec. 31, Twp 09S, Rge 18E, B.M. JEROME County PLACE OF USE: POWER NElNWlSwlSEl NE I Nwl swlsE l- NE lNwl swlsE l_ NE I Nwl swlqEL NE I NWlgwlSE l_ rotalsI I lx II I lL15 I Twp Rge Sec 09s 17E 36 CONDITIONS OF APPROVAL 1. Proof of application of water to beneficial use shall be submitted on or before June 01, 2017. 2. Subject to all prior water rights. 3. This right does not grant any right-of-way or easement across the land of another, nor does it constitute approval that may be required by the United States to access federal public land for activities associated with generating power on federal public land. 4. This right does not constitute ldaho Public Utilities Commission or Federal Energy Regulatory Commission approvalthat may be required. 5. This right is subject to the provisions of Sections 42-205 through 42-210,ldaho Code, restricting the sale, transfer, assignment, or mortgage of this right. Failure to comply with these provisions is cause for immediate cancellation of this right. 6. Use of water under this right shall be non-consumptive. 7. The right holder shall install a measuring device that can be used to determine the instantaneous rate of flow of water through the system, or the right holder shall provide to the department a flow rate measurement or computation made by a certified water right examiner in accordance with actual system design and operation. Page 2 State of ldaho Department of Water Resources Permit to Appropriate Water NO.2-10325 8. CONDITIONS OF APPROVAL CONTINUED The water right acquired under this permit for hydropower purposes shall be junior and subordinate to all rights to the use of water, other than hydropower, within the State of ldaho that are initiated later in time than the priority of this permit and shall not give rise to any right or claim against future rights to the use of water, other than hydropower, within the State of ldaho initiated later in time than the priority of this permit. For purposes of the determination and administration of this water right, no portion of the waters of the Snake River or surface or ground water tributary to the Snake River upstream from Milner Dam shall be considered. 9. 10. The term of this permit shall run concurrently with Shoshone Falls Project license 2778 issued by the Federal Energy Regulatory Commission (FERC), which expires on July 31,2044. The term shall automatically extend to run concurrently with any annual renewals of the project's FERC license. Prior to the issuance of a subsequent or new FERC license for the project, the Director may review the permit or subsequent water right license and may issue an order canceling all or any part of the use, establishing a new term, or revising, adding or deleting conditions under which the water right may be exercised. The order shalltake effect on the date the current term, as may be extended through annual renewals, expires. lf the Director does not issue such an order, the term shall automatically extend to a length equal to the project's subsequent or new FERC license and any prior conditions on the permit or subsequent water right license shall remain in effect. This permit is issued pursuant to the provisions of Section 42-204,ldaho Code. Witness the signature of the Director, affixed at Boise, tnis 2 7[ oaV ot Sa,n u a r Y , 20-]-L