20170222IPC to Micron 1-6.pdf

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LISA D. NORDSTROM
Lead Counse!
I [e-mail]
February 22,2017
VIA HAND DELIVERY
Diane M. Hanian, Secretary
ldaho Public Utilities Commission
47 2 W est Wash ington Street
Boise, ldaho 83702
Case No. IPG-E-16-24
Recovery of Costs Associated with North Valmy Power PIant - ldaho Power
Company's Response to the First Data Request of Micron Technology, lnc.
Dear Ms. Hanian
Enclosed for filing in the above matter please find an original and three (3) copies of
ldaho Power Company's Response to the First Data Request of Micron Technology, lnc.
Also enclosed are four (4) copies of a non-confidential disk containing information
responsive to Micron Technology, lnc.'s data requests.
Very truly yours,
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Lisa D. Nordstrom
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An IDACORP Companv
1221 W ldaho St. (83702)
PO. Box 70
Boise, lD 83707
Re
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Enclosures
LISA D. NORDSTROM (lSB No. 5733)
ldaho Power Company
1221West ldaho Street (83702)
P.O. Box 70
Boise, ldaho 83707
Telephone: [phone]
Facsimile: [phone]
lnordstrom@idahopower. com
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Attorney for ldaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
!N THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
AUTHORITY TO INCREASE ITS RATES
FOR ELECTRIC SERVICE TO RECOVER
COSTS ASSOCIATED WITH THE NORTH
VALMY PLANT
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CASE NO. IPC-E-16-24
IDAHO POWER COMPANY'S
RESPONSE TO THE FIRST
DATA REQUEST OF MICRON
TECHNOLOGY, INC.
COMES NOW, ldaho Power Company ("ldaho Powe/' or "Comp?try"), and in
response to the First Data Request of Micron Technology, Inc., to ldaho Power
Company dated February 1,2017, herewith submits the following information:
IDAHO POWER COMPANY'S RESPONSE TO THE
FIRST DATA REQUEST OF MICRON TECHNOLOGY, ]NC. . 1
REQUEST NO. 1-1: Please quantify the annual increase in the proposed
revenue requirement attributable to the proposed accelerated depreciation of Valmy 1
and Valmy 2.
RESPONSE TO REQUEST NO. 1.1:The levelized revenue requirement
amount attributable to the accelerated depreciation of the Valmy plant is $39,733,117
on an ldaho jurisdictional basis, of which $17,472,605 is already included in customer
rates, resulting in an incremental annual increase ol $22,260,512.
The response to this Request is sponsored by Matt Larkin, Revenue
Requirement Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE
FIRST DATA REQUEST OF MICRON TECHNOLOGY, INC. - 2
REQUEST NO. 1-2: Referring to Exhibit No. 3 of Mr. Larkin's testimony, please
provide a similar revenue requirement summary for the current test year for the Valmy
units.
RESPONSE TO REQUEST NO. 1-2: Please see the workpapers in the Excel
file provided electronically with this response used to support the calculations in Exhibit
No. 2 to the testimony of Mr. Larkin. The workpapers include the Valmy revenue
requirement computation for a 2017 test year, $48,182,681 on a system basis. The
computation can be found on the "Existing Investments" tab, cellJ10.
The response to this Request is sponsored by Maft Larkin, Revenue
Requirement Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE
FIRST DATA REQUEST OF MICRON TECHNOLOGY, INC. - 3
REQUEST NO. 1-3: Referring to Mr. Larkin's testimony at p. 16, Iines 3-12,
specifically: "ldaho Power has filed its updated depreciation study in Case No.
IPC-E-16-23 that incorporates Valmy's 2025 end-of-life date and adjusts depreciation
rates accordingly. ." Please provide the following information as of December 31,
2016 (i.e., the type of information presented in a depreciation study):
a. Plant balances for Valmy 1 and Valmy 2 by account (i.e., Accounts
310.20, 311, 312.10, 312.30, 314, 315, 316, etc.);
b. Book reserve balances for Valmy 1 and Valmy 2 by account;
c. Current net salvage rates for Valmy 1 and Valmy 2 by account;
d. Current remaining life calculations for Valmy 1 and Valmy 2 by account;
e. Current depreciation rates for Valmy 1 and Valmy 2 by account;
f. Proposed depreciation rates for Valmy 1 and Valmy 2 by account;
g. Depreciation expense under existing depreciation rates; and
h. Depreciation expense under proposed depreciation rates.
RESPONSE TO REQUEST NO. 1.3:
a. Please see column (2) of the Excel file provided electronically with this
response that includes the original cost of Valmy plant-in-service amounts as of
December 31,2016, by account and by location.
b. Please see column (6) of the Excel file provided electronically with this
response that includes the Valmy reserve balances as of December 31, 2016, by
account and by location.
c. Please see column (3) of the Excel file provided electronically with this
response that includes the net salvage percentage of each Valmy account, by location.
IDAHO POWER COMPANY'S RESPONSE TO THE
FIRST DATA REQUEST OF MICRON TECHNOLOGY, INC. - 4
d. Please see column (7) of the Excel file provided electronically with this
response that includes the current remaining life of each Valmy account, by location.
e. Please see column (5) of the Excel file provided electronically with this
response that includes the current depreciation rate of each Valmy account by location.
f. The depreciation expense included in the Company's request in this case
was calculated by estimating the total net book value of all Valmy plant accounts as of
May 31 , 2017, divided by the remaining life of the plant, nine years, resulting in an
annual proposed depreciation expense of $24,085,267.
g. Please see column (4) of the Excel file provided electronically with this
response that includes the pro forma depreciation expense under existing depreciation
rates for each Valmy account, by location.
h. Please see the Company's response to subpart f above.
The response to this Request is sponsored by Donna Wheeler, Finance Team
Leader, and Courtney Waites, Senior Regulatory Analyst, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE
FIRST DATA REQUEST OF MICRON TECHNOLOGY, INC. - 5
REQUEST NO. 14: Please quantiff the dollar revenue requirement difference
between the Company's proposal to accelerate Valmy depreciation rates, and leaving
the currently-approved depreciation rates in place (i.e., no acceleration), regardless of
the actual retirement dates for Valmy 1 and Valmy 2 under each of the following
scenarios:
a. lncluding full recovery of the forecasted capital additions and
decommissioning costs described in Exhibit 2 of Mr. Larkin's testimony; and
b. Without including recovery of the forecasted capital additions and
decommissioning costs. (ln other words, including only the plant investment through
12-31-16).
RESPONSE TO REQUEST NO. 14: ln response to clarification received from
Micron Technology, lnc. ("Micron"), ldaho Power is updating the levelized revenue
requirement computation under the above scenarios and will have the completed
response to this Request by close of business Friday, February 24,2017.
The response to this Request is sponsored by Matt Larkin, Revenue
Requirement Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE
FIRST DATA REQUEST OF MICRON TECHNOLOGY, INC. - 6
REQUEST NO. {-5: Referring to Exhibit No. 2 of Mr. Larkin's testimony, please
explain in detail how the "Existing Accelerated" amounts from 2017-2025 were
calculated (at the top left-hand side of the exhibit).
RESPONSE TO REQUEST NO. 1-5: Please see the Excel file provided
electronically with the Company's response to Micron's Request No. 1-2 for the detailed
calculation of the Revenue Requirement on Existing lnvestments. The calculation
begins with the May 31 ,2017, net book value (cell 837) and calculates the accelerated
depreciation based on the remaining life (cell 836). These book depreciation amounts
are listed in column P. Next, columns Q through X calculate the return on the rate base
and associated taxes to determine the total revenue requirement for book depreciation
and taxes. These amounts are then replicated in column E where property taxes are
added to determine the total revenue requirement based on a 2025 depreciable life,
presented in column J. These steps are repeated for each of the remaining nine years.
The results in column J are presented in Exhibit No. 2 under the "Revenue Requirement
on Existing lnvestments at May 31 ,2017" section.
The response to this Request is sponsored by Matt Larkin, Revenue
Requirement Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE
FIRST DATA REQUEST OF MICRON TECHNOLOGY, INC. - 7
REQUEST NO. 1-6: Referring to the levelized revenue requirement of
$41,787,659 in Exhibit No. 2 in Mr. Larkin's testimony, how much of this amount is
attributable to depreciation expense.
RESPONSE TO REQUEST NO. 1-6: The levelized revenue requirement
amount of $41,787,659 includes $24,085,267 of depreciation expense.
The response to this Request is sponsored by Matt Larkin, Revenue
Requirement Manager, ldaho Power Company.
DATED at Boise, ldaho, this 22nd day of February 2017 .
D
Attorney for ldaho Power Company
IDAHO POWER COMPANY'S RESPONSE TO THE
FIRST DATA REQUEST OF MICRON TECHNOLOGY, INC. - 8
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 22nd day of February 2017 I served a true and
correct copy of IDAHO POWER COMPANY'S RESPONSE TO THE FIRST DATA
REQUEST OF MICRON TECHNOLOGY, lNC., upon the following named parties by the
method indicated below, and addressed to the following:
Commission Staff
Camille Christen
Deputy Attorney General
ldaho Public Utilities Commission
472 West Washington (83702)
P.O. Box 83720
Boise, ldaho 83720-0074
Micron Technology, lnc.
Thorvald A. Nelson
Frederick J. Schmidt
Emanuel T. Cocian
Brian T. Hansen
HOLLAND & HART, LLP
6380 South Fiddlers Green Circle, Suite 500
Greenwood Village, Colorado 80111
Pete Bennett
Micron Technology, lnc.
8000 South FederalWay
Boise, ldaho 83707
ldaho Irrigation Pumpers Association, lnc.
Eric L. Olsen
ECHO HAWK & OLSEN, PLLC
505 Pershing Avenue, Suite 100
P.O. Box 6119
Pocatello, ldaho 83205
Anthony Yanke!
12700 Blake Avenue, Unit 2505
Lakewood, Ohio 44107
IDAHO POWER COMPANY'S RESPONSE TO THE
FIRST DATA REQUEST OF MICRON TECHNOLOGY, INC. - 9
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Benjamin J. Otto
ldaho Conservation League
710 North Sixth Street
P.O. Box 844
Boise, ldaho 83701
Sierra Club
Travis Ritchie
Sierra Club
2101 Webster Street, Suite 1300
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United States Department of Energy and
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Steven Porter
Office of the General Counsel (GC-76)
The United States Department of Energy
1000 lndependence Avenue, SW (Room 6D-033)
Washington, D.C.20585
IDAHO POWER COMPANY'S RESPONSE TO THE
FIRST DATA REQUEST OF MICRON TECHNOLOGY, INC. - 1O
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