20150206IPC to ICIP 1-23.pdf

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JULIAA. HILTON
Corporate Gounsel
ih [e-mail]
February 6, 2015
VIA HAND DELIVERY
Jean D. Jewell, Secretary
ldaho Public Utilities Commission
472 West Washington Street
Boise, ldaho 83702
Re: Case Nos. IPC-E-14-41and PAC-E-14-11
Exchange of Certain Transmission Assets - ldaho Power Company's
Response to the First Production Request of the lndustria! Customers of
ldaho Power
Dear Ms. Jewell:
Enclosed for filing in the above matters please find duplicate originals and three
(3) copies of ldaho Power Company's Response to the First Production Request of the
lndustrial Customers of ldaho Power.
Also enclosed are five (5) copies each of non-confidential and confidential disks
containing information responsive to the lndustrial Customers of Idaho Power's requests
for production.
j. ri;,-.,1
An IDACORP Company
1221 W. ldaho 5t. (83702)
PO. Box 70
Boise, lD 83707
JAH:csb
Enclosures
JULIA A. HILTON (lSB No. 7740)
ldaho Power Company
1221West ldaho Street (83702)
P.O. Box 70
Boise, ldaho 83707
Telephone: [phone]
Facsimile: [phone]
ih i lton@idahopower. com
Attorney for ldaho Power Company
DANIEL E. SOLANDER (!SB No. 8931)
Rocky Mountain Power
201 South Main Street, Suite 2300
Salt Lake City, Utah 84111
Telephone: (801 | 220-4014
Facsimile: (801 ) 220-3299
dan iel. solander@ pacificorp. com
Attomey for PacifiCorp
IN THE MATTER OF THE APPLICATION
OF PACIFICORP DBA ROCKY
MOUNTAIN POWER AND IDAHO POWER
COMPANY FOR AN ORDER
AUTHORIZING THE EXCHANGE OF
CERTAI N TRANSMISS ION ASSETS
CASE NOS. IPC-E-14-41
PAC-E-14-11
IDAHO POWER COMPANY'S
RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE
INDUSTRIAL CUSTOMERS OF
IDAHO POWER
Lrt 50
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
COMES NOW, Idaho Power Company ("ldaho Powe/' or "Comp?try"), and in
response to the First Production Request of the lndustrial Customerc of ldaho Power to
ldaho Power Company dated January 16, 2015, herewith submits the following
information:
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 1
REQUEST FOR PRODUCTION NO. 1: Please provide copies of all material
provided to the Commission Staff regarding the Company's application that were
provided other than through forma! discovery, both prior to, and after, the filing of the
Application.
RESPONSE TO REQUEST FOR PRODUCTION NO. 1: Please refer to
PacifiCorp dlbla Rocky Mountain Power and Pacific Power's (collectively referred to as
"PacifiCorp") response to the lndustrial Customers of ldaho Powefs ('lClP") Request for
Production No. 1.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 2
REQUEST FOR PRODUCTION NO. 2: Reference direct testimony of Lisa Grow
at pp. 4-6. Please provide the Legacy Agreements discussed and all amendments
thereto.
RESPONSE TO REQUEST FOR PRODUCTION NO. 2: Please see the
documents provided on the non-confidential CD.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REOUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 3
REQUEST FOR PRODUCTION NO. 3: Please provide all work papers and
supporting documents used or referred to in preparation of the Company's Application.
RESPONSE TO REQUEST FOR PRODUCTION NO. 3: Please see the
Company's response to Request for Production No. 7(a) for a copy of the confidential
work papers that support the computation of the jurisdictional revenue requirement used
to assist in the preparation of the Application. All other work papers and supporting
documents used in the preparation of the Company's Application were filed as an
attachment to the Application or an exhibit to testimony.
Please see PacifiCorp's responses to lClP's Request for Production Nos. 3, 4,
and 5 in Case No. PAC-E-14-11 for work papers supporting the direct testimony of
PacifiCorp witnesses Gregory N. Duvall and Richard A. Vail.
The response to this Request is sponsored by Lisa Grow, Senior Vice President
of Power Supply, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 4
REQUEST FOR PRODUCTION NO. 4: Please provide copies of all materials
provided to any party in Federal Energy Regulatory Commission Docket Nos. ER15-
680; ER15-683; ER15-681; ER15-682 and EC15-54 (including informal discovery or
materials provided to FERC Staff or any other parties).
RESPONSE TO REQUEST FOR PRODUCTION NO. 4: Please see the
presentation and communication (Attachments 1 and 2) provided on the non-
confidential CD and the confidential responses to Bonneville Power Administration's
questions provided on the confidential CD (Confidential Attachment 3). The confidential
CD will only be provided to those parties that have executed the Protective Agreement
in this matter.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 5
REQUEST FOR PRODUGTION NO. 5: Please explain, and document, the
impact of the asset exchange on existing generator interconnection agreements and
arrangements.
RESPONSE TO REQUEST FOR PRODUCTION NO. 5: The asset exchange is
not anticipated to have any impact on existing generator interconnection agreements or
anangements.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 6
REQUEST FOR PRODUCTION NO. 6: What is the impact of the asset
exchange on the need, or lack of need, for the Hemmingway to Boardman Transmission
project? Please explain whether the transaction, if approved, wi!! delay the need for or
size of the Hemmingway to Boardman Transmission project.
RESPONSE TO REQUEST FOR PRODUCTION NO. 6: The proposed
transaction will not impact the need or size of the Boardman to Hemingway
transmission project.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 7
REQUEST FOR PRODUCTION NO. 7: Exhibit No. 1 attached to the direct
testimony of ldaho Power witness Lisa Grow displays the ldaho Jurisdictional Present
Value Revenue Requirement lmpact for the years 2015-2024, please provide:
a) A functioning electronic copy of Exhibit No. 1 with formulas intact;
b) The work papers used to derive the values in Exhibit No. 1;
c) The assumptions used in the 10 year projections for the values in Exhibit
No.
d) For the purposes of Exhibit No. 1, does ldaho Power assume it wil! not file
a general rate case that would impact the values such as the authorized rate of return,
revenues, expenses, etc. over the 10 year period?
RESPONSE TO REQUEST FOR PRODUCTION NO. 7:
a) Please refer to the confidential Excel spreadsheet provided on the
confidential CD. The confidential CD will only be provided to those parties that have
executed the Protective Agreement in this matter.
b) The confidential Excel spreadsheet provided in response 7(a) contains
several tabs that are the work papers used to derive the values in Exhibit No. 1.
c) The confidential Excel spreadsheet provided in response 7(a) contains the
tabs "Plant & Expense Assumptions" and "Trans Revenue Assumptions" that detail the
assumptions used in the 1O-year projections that result in the values included in Exhibit
No.1.
d) ln order to isolate the impact of the asset exchange on the ldaho
jurisdictional annual revenue requirement, the Company only modeled the changes
associated with the proposed asset exchange over the 10-year period, 2015-2024. The
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 8
analysis did not include considerations of a genera! rate case(s) during the analysis time
period. This does not suggest that the Company will or will not file a general rate case
during that time.
The response to this Request is sponsored by Lisa Grow, Senior Vice President
of Power Supply, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER.9
REQUEST FOR PRODUCTION NO. 8: Reference Exhibit 8, p. 2,attached to
the testimony of Richard Vail and providing elements of PacifiCorp's projected annual
retail revenue requirement for each year through 2025 under the status quo and with
the proposed transaction consummated.
a) Why is an identical chart not provided for ldaho Power?
b) Please produce an identical chart for ldaho Power.
c) Please provide all supporting work papers and documents for the chart
provided in response to subpart b.
RESPONSE TO REQUEST FOR PRODUGTION NO. 8:
a) Lisa Grow's Exhibit No. 1 provides a summary of the impact to the ldaho
jurisdictional revenue requirement over the 1O-year period 2015-2024 if the proposed
asset exchange is approved. While not in the same format as the chart in Richard Vail's
testimony, all confidential work papers that support the values in Exhibit No. 1 are
provided in the Company's response to lClP's Request for Production No. 7(a). The
confidential Excel spreadsheet provided in the Company's response to lClP's Request
for Production No. 7(a) contains the work papers that support the values in Exhibit No. 1
and the equivalent information to Richard Vail's Exhibit No. 8, p.2, an be found on the
tab labeled "Trans Revenue Assumptions."
b) Please see the confidential Excel spreadsheet provided in the Company's
response to lClP's Request for Production No. 7(a).
c) Please see the confidential Excel spreadsheet provided in the Company's
response to lClP's Request for Production No. 7(a).
The response to this Request is sponsored by Lisa Grow, Senior Vice President
of Power Supply, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 1O
REQUEST FOR PRODUCTION NO. 9: Reference the direct testimony of David
Angell at page 15, stating:
Throughout spring, conditions regularly exist where transfers
from the Northwest into ldaho Powe/s system, coupled with
generation out of the Hells Canyon complex, can substantially
exceed ldaho Power's west side load. ln these cases,
eastbound capacity is needed across Midpoint West path to
source southern and eastern load and reduce thermal coal
generation in the east and serve load with low-cost hydro power
from the northwest. With the acquisition of Hemingway -
Midpoint eastbound capacity, this constraint will be alleviated.
Please provide any studies ldaho Power has undertaken that support the above
statement and indicate which thermal coal generation units would be expected to be
ramped down and the degree of reduced coal generation as well as projected revenue
requirement impacts.
RESPONSE TO REQUEST FOR PRODUCTION NO. 9: Dave Angell's
testimony begins with "ldaho Power will also receive 700 MW of Hemingway-Midpoint
eastbound capacity. This capacity will greatly increase ldaho Power's resource
flexibility in the spring and early summer." The system conditions are 12OO megawatts
('MW') import from the Northwest transmission path, 2080 MW of west-side system
resources, and up to 1400 MW of east-side load. The existing transmission capacity
between the west-side and south/east-side system is 960 MW. The additional 700 MW
of transmission capacity obtained from the asset exchange wil! allow ldaho Power to
economically supply the south/east-side load through 1660 MW of transmission
capacity, allowing ldaho Power to reduce the Valmy and Jim Bridger power plant
generation. ldaho Power has not projected revenue requirement impacts from this
proposed operating scenario.
The response to this Request is sponsored by David
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 11
Customer
REQUEST FOR PRODUCTION NO. 10: Reference the direct testimony of
David Angell at page 15, stating:
Furthermore, the Hemingway - Midpoint eastbound capacity will
be necessary to completely and economically integrate the
Boardman - Hemingway 500 kV transmission project ("B2H").
When completed, B2H will increase the amount of power that
ldaho Power can purchase from the northwest by 500 MW
during spring and summer months.
a) Please provide any studies ldaho Power has undertaken that support the
above statement and indicate the quantity of the purchases from the Northwest and the
savings in power costs expected.
b) When does Idaho Power expect the Boardman-Hemingway transmission
line to be operational?
RESPONSE TO REQUEST FOR PRODUGTION NO. 10:
a) Please see the confidential Boardman to Hemingway path rating study
provided on the confidential CD. The confidentia! CD will only be provided to those
parties that have executed the Protective Agreement in this matter. The economic
integration comes from the asset exchange to avoid the construction of new
transmission lines east of the Hemingway substation prior to the development of the
Gateway West segments between Hemingway, Cedar Hill, and Midpoint.
b) ldaho Power is unable to accurately determine an approximate in-service
date for the line but continues to expect the in-service date to be tn 2O2O or beyond.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REOUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 12
REQUEST FOR PRODUCTION NO. 11: Reference the direct testimony of Lisa
Grow at pp. 16-17, indicating that replacing the Legacy Agreements with the JPSA and
JOOA wil! change ldaho Power's OATT formula rate that will be reflected in future
annual updates.
a) Please provide the current OATT formula rate calculations along with the
sources of the inputs.
b) Please provide any calculations or studies ldaho Power has undertaken
indicating what the future OATT formula rates would be if the transfer of assets is
approved.
RESPONSE TO REQUEST FOR PRODUCTION NO. 11 :
a) ldaho Powe/s current Open Access Transmission Tariff ("OATT") rate
calculation is publicly available and located on Idaho Powe/s Open Access Same-time
lnformation System (.OASIS') site via the following link:
http://www.oatioasis.com/IPCO/IPCOdocsffransmission Rate October 1 2014-
Seot 30 2015 Final Informational Postino.xlsx
b) !n the confidential Excel spreadsheet provided in the Company's response
to ICIP's Request for Production No. 7(a\, the tab labeled "Trans Revenue
Assumptions" contains Idaho Powe/s analysis of the estimated impact of future OATT
formula rates if the transfer of assets is approved.
The response to this Request is sponsored by Lisa Grow, Senior Vice President
of Power Supply, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 13
REQUEST FOR PRODUCTION NO. 12: Reference the direct testimony of Lisa
Grow at p. 11, indicating the transaction may help facilitate development of the Energy
lmbalance Market.
a) Please provide all studies and analysis conducted by ldaho Power
regarding the benefits of ldaho Power joining the Energy lmbalance Market.
b) Does ldaho Power intend to ever join the Energy lmbalance Market?
Please explain why or why not.
RESPONSE TO REQUEST FOR PRODUCTION NO. 12: ldaho Power has not
conducted any studies as to the benefits specific to ldaho Power joining an Energy
lmbalance Market. ldaho Power is an active participant in the Northwest Power Pool
MC lnitiative, which is looking at the development of a Security Constrained Economic
Dispatch ("SCED') model for that footprint, and has participated in studies related to the
regional efforts. Results from that study can be found via the following link:
http://www.pnnl.qov/main/publications/external/technical reports/PNNL-22877.pdf.
ldaho Power continues to actively participate in the activities regarding the development
of the SCED, but the timing associated with the Company joining such a market is
unknown.
The response to this Request is sponsored by Lisa Grow, Senior Vice President
of Power Supply, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 14
REQUEST FOR PRODUCTION NO. 13: Reference the direct testimony of Lisa
Grow at p. 18, stating that by entering into the Legacy Replacement, ldaho Poweds
ldaho-jurisdictional revenue requirement will be reduced by $SS.g million.
a) Does ldaho Power's Application seek to reduce its retail rates to pass this
reduced revenue need onto its ldaho retail customers? lf not, please explain why not.
b) When and how would ldaho retai! customers experience a reduction in
rates corresponding with the $55.9 million benefit of the transaction?
RESPONSE TO REQUEST FOR PRODUCTION NO. 13:
a) No. As stated on page 19 of Lisa Grow's testimony, "Commission
approval of the Legacy Replacement will have no immediate retail customer rate impact
for ldaho Power. A change to the revenue credit used to offset retail customer rates will
occur when the Company files its next general rate case."
b) Any annua! revenue requirement impact would be reflected in the
Company's next general rate case; the date of such a filing is unknown.
The response to this Request is sponsored by Lisa Grow, Senior Vice President
of Power Supply, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 15
REQUEST FOR PRODUCTION NO. 14: On what date did ldaho Power and
PacifiCorp begin discussing the proposed transaction and on what date were the terms
finalized?
RESPONSE TO REQUEST FOR PRODUCTION NO. 14: ldaho Power and
PacifiCorp entered into discussions in July 2014 that led to a finalized term sheet for the
proposed transaction on August 14, 2014. Further discussions in August and
September 2014 led to the execution of definitive agreements for the proposed
transaction on October 24,2014.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 16
REQUEST FOR PRODUCTION NO. 15: Please provide al! intemal reports or
memoranda presenting the terms and/or benefits of the transaction to (a) ldaho Power's
board of directors and (b) ldaho Poweds senior officers.
RESPONSE TO REQUEST FOR PRODUCTION NO. 15: Please see the
documents provided on the non-confidential CD and confidentia! CD. The confidential
CD will only be provided to those parties that have executed the Protective Agreement
in this matter.
The response to this Request is sponsored by Dick Garlish, Regulatory
Compliance Director of Audit, Compliance, and Security, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 17
REQUEST FOR PRODUCTION NO. 16: Reference the direct testimony of
Richard Vai!, at p. 10, stating that following the transaction PacifiCorp will have an
ownership interest and all three transmission lines in the Jim Bridger area and thus be
able to use its rights on a!! three lines to serve !oad. Will PacifiCorp pay ldaho Power
for the newly acquired transmission capacity rights through point-to-point or network
transmission rights? lf no, why not?
RESPONSE TO REQUEST FOR PRODUCTION NO. 16: No, PacifiCorp will
have a capacity allocation commensurate with its ownership of the transmission line.
However, Idaho Power will manage allocated capacity according to Joint Ownership
and Operating Agreement ("JOOA") Sections 3.2(b) and (c). PacifiCorp, as a customer
of Idaho Power, may request any available transmission capacity.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 18
REQUEST FOR PRODUCTION NO. 17: Reference the direct testimony of
Richard Vai!, at p. 11, stating that PacifiCorp will acquire 510 MW of OATT service and
will have 1,090 MW of "ownership rights" to make transfers across the thee fsrd Jim
Bridger Iines.
a) Please explain how "ownership rights" in 1,090 MW confers the right to
transfer capacity on a point-to-point or network service basis under the OATT and/or the
applicable Legacy Agreement(s).
b) ls the proposal to grant PacifiCorp a perpetual right to transfer across
these lines simply by virtue of selling ownership in the lines? lf so, please explain how
this is more advantageous to ldaho Power than charging PacifiCorp or other eligible
transmission customers for service under the applicable Legacy Agreement(s) and/or
the OATT.
c) Why are the 510 MW needed to be purchased under the OATT, while
1,090 MW need not be purchased under the OATT?
d) Please provide the projected lost revenue for the next ten years from
transmission rates associated with the 1,090 MW under the proposed transaction, and
explain how that lost revenue is factored into the analysis provided in Exhibit No. 1
attached to the direct testimony of Lisa Grow.
RESPONSE TO REQUEST FOR PRODUCTION NO. 17: The Direct Testimony
of Richard Vail states, "As detailed in the JPSA, PacifiCorp will have ownership rights
and wheeling rights that it can use across all three transmission lines. Specifically,
PacifiCorp will have 1,090 MW of ownership rights, plus 510 MW of firm OATT service,
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 19
including 400 MW of dynamic service." The three lines referenced in testimony are
west of Kinport, not Jim Bridger lines.
a) The Direct Testimony of Richard Vail states, "PacifiCorp will be able to use
a combination of point-to-point transmission service rights over ldaho Power's system,
and PacifiCorp network transmission service on newly owned assets. ." The asset
exchange will provide PacifiCorp a transmission allocation commensurate with its
ownership. As stated in the JOOA, Section 3.2 (c), "Each Owner shall have the right to
post and sell its Directional Capacity Allocation over a Path in accordance with its
OATT, and each Owner shall schedule energy or make available for scheduling a Path
. ." ln accordance with its OATT, PacifiCorp may schedule energy to serve
PacifiCorp load on a line with a capacity allocation through network transmission
service.
b) No. The purpose of the transaction is not to provide any perpetual rights.
The benefits of the transaction are detailed in both Lisa Grow's and David Angell's
testimonies.
c) Federal Energy Regulatory Commission ("FERC") regulation requires a!!
transmission use of ldaho Power's system to be purchased following the OATT.
PacifiCorp will own 1090 MW of transmission capacity, which will be posted on OASIS
and purchased by PacifiCorp Commercial and Trading. PacifiCorp Commercial and
Trading will also purchase 510 MW of OATT service from ldaho Power to obtain a total
of 1600 MW of transmission capacity.
d) Based on the preceding subparts in this Request, ldaho Power believes
the question in subpart (d) is referring to transmission service revenue. The analysis
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 20
presented as Exhibit No. 1 to Lisa Grow's testimony demonstrates that there is a net
increase in transmission revenue if the asset exchange is approved. As described on
page 17 of Lisa Grow's testimony, "upon termination of the MTFA, RTSA, and ITSA,
the associated contract demands used in the calculation of ldaho Powe/s OATT
formula rate will become zeto." This change will result in an increase to ldaho Power's
transmission rate, which is projected to translate into higher transmission revenues.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company, and Kelley Noe, Regulatory
Analyst, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 21
REQUEST FOR PRODUCTION NO. 18: PIease explain if it is the Applicants'
understanding that a transfer of ownership of a transmission line also necessarily
results in a corresponding transfer of transmission capacity or rights in the line
corresponding to the share of ownership. Please provide the basis for the answer.
RESPONSE TO REQUEST FOR PRODUCTION NO. 18: Transfer of ownership
of a transmission line does not necessarily result in a transfer of transmission capacity
or transmission rights in the line corresponding to the share of ownership. Where a
transmission line is jointly owned, transmission capacity allocations do not always mirror
ownership percentages. This occurred in the agreement for the Joint Purchase and
Sale of the Populus and Hemingway substations, which was accepted by FERC in an
order issued on July 9,2010, in Docket No. ER1O-1220-000. Regardless of ownership
of a transmission line, transmission service is governed by FERC's open access
requirements, reliabi I ity sta ndaids, and other reg ulatory requirements.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF ]DAHO POWER - 22
REQUEST FOR PRODUCTION NO. 19: Reference the direct testimony of
Richard Vail, p. 12, stating "under the new joint ownership arrangements, costs for
future upgrades would be shared in accordance with the JOOA, potentially resulting in
lower upgrade costs to PacifiCorp's customers."
a) Please provide a list of the lines referenced and for each line: (i) the
upgrade cost responsibility between ldaho Power and PacifiCorp prior to the proposed
transaction, and (ii) after the proposed transaction.
b) Please provide all plans or studies, including any cost estimates,
regarding upgrades that will be necessary in the next ten years on the lines referenced
in this portion of Mr. Vail's testimony.
c) Please explain where the increased cost to ldaho Power associated with
any upgrades to these and all other facilities acquired by ldaho Power are factored in
the analysis of the revenue requirement impacts set forth in Exhibit No. 1 attached to
Lisa Grow's direct testimony.
RESPONSE TO REQUEST FOR PRODUCTION NO. 19:
a) The upgrade cost responsibility between ldaho Power and PacifiCorp prior
to the proposed transaction, and after the proposed transaction, is as follows:
Transmission Line Prior Upgrade Cost
Resoonsibilitv
After Upgrade Cost
Resoonsibilitv
tPc PAC lPc PAC
Bridoer-Goshen 345 kV 100.0%O.Oo/o 29.0o/o 71.0o/o
Bridoer-Pooulus #1 345 kV 0.0%100.0%29.0o/o 71.Oo/o
Bridoer-Pooulus #2 345 kV 0.0%100.0%29.0o/o 71.0o/o
Pooulus-Kinoort 345 kV 0.0%100.0%29.0o/o 71.Oo/o
Populus-Borah#1345 kV 0.0o/o 100.0%29.0o/o 71.0o/o
Pooulus-Borah#2 345 kV O.0o/o 100.0%0.0%100.0%
Goshen-Kinport 345 kV 0.00,/o 100.0%15.7o/o 84.30/o
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF ]DAHO POWER - 23
Bridqer-Point of Rocks 230 kV 33.3%66.7o/o 0.0o/o 100.0%
Bridoer-Rock Sorinos 230 kV 33.3%66.7o/o 0.0%100.0%
Kinport-Midpoint 345 kV 100.0%0.0%73.2%26.8%
Borah-Adelaide-Midpoint #1 345 kV 100.0%0.0%64.4o/o 35.6%
Borah-Adelaide-Midooint #2 345 kV 100.0%0.0%64.40/35.6%
Goshen-Jefferson 161 kV 100.0%O.Oo/o 37.80/o 62.2o/o
Jefferson-Bis Grassy 161 kV 100.0%0.0%37.80/o 62.2o/o
Heminqwav-Summer Lake 500 kV 0.0%100.0%22.0o/o 78.0o/o
Walla Walla-Hurricane 230 kV o.o%100.0%40.80/o 59.2o/o
Midooint-Heminowav 500 kV 0.0%100.0%37.0o/o 63.0%
Antelope-Goshen 161 kV 0.Oo/o 100.0%21.9o/o 78.10/o
American Falls-Malad 138 kV 0.0%100.0%3.60/0 96.40/o
Antelooe-Scoville 138 kV o.oo/o 100.0%11.5o/o 88.5%
b) JOOA Exhibit Schedule 1.1(e) provides the list of ldaho Power executive-
approved planned upgrades for the next 10 years. Please see the confidential
document provided on the confidential CD which provides the cost estimate for each of
these improvements. The confidential CD will only be provided to those parties that
have executed the Protective Agreement in this matter.
c) The costs associated with future upgrades were not included in the
revenue requirement analysis provided as Exhibit No. 1 to Lisa Grow's testimony.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company, and Kelley Noe, Regulatory
Analyst, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 24
REQUEST FOR PRODUCTION NO. 20: Reference the direct testimony of
Richard Vail, p. 13, at lines 14-17, indicating the transaction includes a provision that
ldaho Power and PacifiCorp will share the costs of upgrading the 161 kV Goshen to
Jefferson line.
a) What is the estimated cost of this upgrade?
b) What was the allocation of cost responsibility prior to the proposed
transaction?
c) ls ldaho Power seeking cost recovery for this upgrade with the
Application?
RESPONSE TO REQUEST FOR PRODUCTION NO. 20:
a) The estimated cost to upgrade the transmission line between Goshen and
Jefferson is $16.5 million. This section of line wil! also be allocated a portion of the
Goshen to Stateline permitting costs, which are estimated to be less than $1 million.
b) ldaho Power and PacifiCorp do not have an existing allocation of cost
responsibility for capital upgrades. The legacy agreement that the companies are
operating under only allocates cost responsibility for maintenance. ln addition to the
asset exchange agreements executed on October 24, 2014, the companies have
signed a Permit Funding Agreement, which contains an allocation of permitting costs of
34.6 percent to PacifiCorp and 65.4 percent to ldaho Power.
c) No.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 25
REQUEST FOR PRODUCTION NO. 21: Reference the direct testimony of
Richard Vail, p. 14, lines 11-15, stating that the value of the assets being exchanged is
nearly equal and the ongoing expenses "will be similar to expenses incurred today."
a) Provide all studies, analyses and reports estimating the ongoing expenses
for the next ten years.
b) Will ldaho Powe/s ongoing expenses by higher or lower than prior to the
proposed transaction?
c) If ldaho Power's ongoing expenses will increase, please explain how retail
rates will not increase.
RESPONSE TO REQUEST FOR PRODUCTION NO. 21:
a) Please refer to the confidential Excel spreadsheet provided on the
confidential CD which details the calculation of the ongoing operations and maintenance
(.O&M') and common facility charges associated with the proposed transaction. The
confidential CD will only be provided to those parties that have executed the Protective
Agreement in this matter.
b) Based on current information, it is estimated that Idaho Power's expenses
will be lower as a result of the proposed transaction. Please refer to the confidential
Excel spreadsheet provided in the Company's response to lClP's Request for
Production No. 21(a) and the tab labeled "Cunent Billings" for more detail.
c) Not applicable.
The response to this Request is sponsored by Paula Penza, Finance Team
Leader ll, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 26
REQUEST FOR PRODUCTION NO. 22: Reference the direct testimony of
David Angel!, p. 9, Iines 12-19, discussing reallocation of responsibilities with regard to
operation of the lines impacted by the proposed transaction.
a) Under the Legacy Agreements, for each line involved in the proposed
transaction, please identify the utility responsible for (i) physical operation and
maintenance, (ii) interconnection requests, (iii) design of the line, (iv) capita! upgrades
and improvements on the line, (v) repair and reconstruction, (vi) security, (vii) outage
restoration, (viii) and retirement and decommissioning.
b) lf the proposed transaction is approved, for each line involved in the
proposed transaction, please identify the utility responsible for (i) physical operation and
maintenance, (ii) interconnection requests, (iii) design of the line, (iv) capital upgrades
and improvements on the line, (v) repair and reconstruction, (vi) security, (vii) outage
restoration, (viii) and retirement and decommissioning.
c) Please explain how this reallocation of responsibilities will impact ldaho
Poweds revenue requirement and provide all supporting analyses and studies.
RESPONSE TO REQUEST FOR PRODUGTION NO. 22:
a) At this time, for all the lines except the following three identified in the
table below, the party responsible for the items (i) through (viii) is indicated in the
"Operatod' column of JOOA Exhibit C.
Transmission Line Responsibilities
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 27
Transmission Line (i)( ii)( iii)(iv)(v)(vi)(vii)(viii)
Jim Bridqer-Goshen tPc tPc !PC lPc IPC tPc tPc tPc
Goshen-Jefferson PAC tPc !PC IPC IPC PAC PAC tPc
Jefferson-Big Grassy PAC lPc rPc IPC rPc PAC PAC tPc
b) At this time, the utilities have not agreed to transfer the responsibilities for
any of the transmission lines. Therefore, the responsible utility continues as listed in the
table in the response to subpart (a) and the Operator column of JOOA Exhibit C.
c) There is not a reallocation of responsibilities and future O&M expenses
are anticipated to be similar; therefore, there is no impact to the revenue requirement
analysis.
The response to this Request is sponsored by Dave Angell, Customer
Operations Planning Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 28
REQUEST FOR PRODUCTION NO. 23: ldaho Powe/s October 24,2014 SEC
Form 8-K states that the JOOA "terminates in the event the transmission facilities are
destroyed and the parties determine not to repair or rebuild the facilities or if the
transmission facilities are retired and decommissioned (as to those specific facilities
only), by mutual agreement of the parties, or upon the occunence of certain uncured
events of default described in the Joint Operating Agreement."
a) Please list the "certain uncured events of default described in the Joint
Operating Agreement." Does the JOOA allow for termination based on these uncured
events at some point after receiving regulatory approvals of the agreement and
consummation of the asset exchange?
b) lf the answer to subpart a) is "yes," how far into the future could such a
termination occur?
c) Please provide any analysis or studies on the potentia! effect on rates in
the event of such a termination of the JOOA after consummation of the asset exchange.
RESPONSE TO REQUEST FOR PRODUGTION NO. 23:
a) Events of default are described with particularity in Sections 12.1(a)-(g) of
the JOOA. Termination provisions are found in Section 2.3 of the JOOA, which states
that the agreement shall terminate: (1) by mutual agreement of the parties or (2) by
exercise of remedies under Section 12.3. Section 12.3 discusses remedies for events
of default, which provides a non-defaulting party with the right to exercise "any of it[s]
remedies at law or in equity" for an event of default which occurs and is continuing.
Whether or not termination could occur under Section 12.3 after receipt of
regulatory approvals would be determined by available remedies at law or in equity for a
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REOUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 29
particular event of default. However, Section 12.3(b) recognizes that the obligations
and covenants to be performed by each party under the JOOA are unique and the non-
defaulting party may be entitled to specific performance because there may not be an
adequate remedy at law.
b) Please see the contract provisions described in the Company's response
to subpart (a) above.
c) No analysis or studies have been performed.
The response to this Request is sponsored by Lisa Grow, Senior Vice President of
Power Supply, ldaho Power Company, in consultation with Julia A. Hilton, Corporate
Counsel, ldaho Power Company.
DATED at Boise, ldaho, this 6th day of February 2015.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 30
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 6th day of February 2015 I served a true and
correct copy of IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER
upon the following named parties by the method indicated below, and addressed to the
following:
Gommission Staff
Daphne Huang
Deputy Attorney General
ldaho Public Utilities Commission
472 W esl Washington (83702)
P.O. Box 83720
Boise, ldaho 83720-007 4
PacifiGorp
Daniel E. Solander
Rocky Mountain Power
201 South Main Street, Suite 23OO
Salt Lake City, Utah 84111
lndustrial Customerc of ldaho Power
Peter J. Richardson
RICHARDSON ADAMS, PLLC
515 North 27th Street (83702)
P.O. Box 7218
Boise, ldaho 83707
Dr. Don Reading
6070 Hill Road
Boise, ldaho 83703
X Hand Delivered
U.S. Mail
Overnight Mail
FAX
Email [e-mail]
Hand Delivered
U.S. Mail
,Overnight Mail
FAXX Email [e-mail]
_Hand DeliveredX U.S. Mail
_Overnight Mail
_FAXX Email [e-mail]
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The United States Department of Energy and
the Federal Executive Agencies
Steven Porter, Assistant General Counsel
Electricity and Fossil Energy
Office of the General Counsel (GC-76)
United States Department of Energy
1000 lndependence Avenue, SW (Room 6D-033)
Washington, D.C.20585
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 31
Dwight Etheridge
10480 Little Patuxent Parkway, Suite 300
Columbia, Maryland 21044
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_Ovemight Mail
_FAXX Email [e-mail]
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST PRODUCTION
REQUEST OF THE INDUSTRIAL CUSTOMERS OF IDAHO POWER - 32