20180810IPC to Staff 22-25.pdf

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Do n E. Walker
An loAcoRP company
1221 W. ldaho St. (83702)
PO. Box 70
Boise, lD 83707
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sst0i{DONOVAN E. WALKER
Lead Counsel
dwa! [e-mail]
August 10,2018
VIA HAND DELIVERY
Diane Hanian, Secretary
!daho Public Utilities Commission
472 West Washington Street
Boise, ldaho 83702
Re Case No. IPC-E-18-07
Petition for Modification of 90/110 Performance Band and Calculation of
O&M Charges for PURPA QFs - ldaho Power Company's Response to the
Third Production Request of the Commission Staff to ldaho PowerCompany
Dear Ms. Hanian
Also, enclosed are four (4) copies of non-confidential disks containing information
responsive to these production requests.
Very tru
(
DEW:csb
Enclosures
Enclosed for filing in the above matter are an original and three (3) copies of ldaho
Power Company's Response to the Third Production Request of the Commission Staff to
ldaho Power Company.
/U/---
DONOVAN E. WALKER (lSB No. 5921)
ldaho Power Company
1221West ldaho Street (83702)
P.O. Box 70
Boise, ldaho 83707
Telephone: [phone]
Facsimile: [phone]
dwa I ke r@ id a h opowelcqm
RiCEIVED
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Attorney for ldaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE PETITION OF
IDAHYDRO, SHOROCK HYDRO, INC.,
J.R. SIMPLOT COMPANY, AND
RENEWABLE ENERGY COALITION FOR
MODIFICATION OF THE 9O/110
PERFORMANCE BAND AND
CALCULATION OF OPERATION AND
MAINTENANCE CHARGES FOR PURPA
QUALIFYING FACILITIES
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CASE NO. IPC-E-18-07
IDAHO POWER COMPANY'S
RESPONSE TO THE THIRD
PRODUCTION REQUEST OF
THE COMMISSION STAFF TO
IDAHO POWER COMPANY
COMES NOW, ldaho Power Company ("ldaho Power" or "Company"), and in
response to the Third Production Request of the Commission Staff to ldaho Power
Company dated July 20, 2018, 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. 22: Please provide updated Schedule 72 Operation and
Maintenance (O&M) flat percentage rates for both distribution-level and transmission-
level interconnections using actual 2015 and 2016 data, respectively. Please provide
workpapers reflecting the calculations with formula intact.
RESPONSE TO REQUEST NO. 22: Please see the Excel file provided on the
enclosed CD for the requested information.
The response to this Request is sponsored by Mitch McClellan, Financial
Analyst, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION
REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 2
REQUEST NO. 23: ln "fsicl ldaho Power Company's Answer and Responses to
ldahohydro [sic] and Shorock Hydro, lnc.'s First Set of lnterrogatories, Requests for
Admission, and Requests for Production of Documents, ldaho Power states in "Answer
to lnterrogatory No. 9" that "charging actual O&M costs for QF projects would mean that
an entirely separate system of work order preparation and billing would have to be
established just for QF projects. ldaho Power believes that such a requirement is both
unreasonable and unnecessary". Please answer the following questions:
a. For purposes of this request, please define "actual O&M costs."
b. Please list the categories of costs that go into the O&M rates and provide
a description of the types and nature of these costs.
c. For each O&M cost category, please describe how the Company could
track them as actual costs and describe the changes in the Company's business
processes that the Company would need to make.
d. For each O&M cost category, please describe and roughly quantify
investments needed in systems, infrastructure, labor, etc. that the Company would need
to make to track them as actual costs.
RESPONSE TO REQUEST NO. 23:
a. ln the context of this Request, "actual O&M costs" includes not only work
(labor and materials) performed directly to the interconnection facilities by ldaho Power
employees, but also indirect labor of support and supervisory personnel, labor
overheads (including such things as payroll taxes and benefits), administrative and
general expense, property insurance, and allocations of property taxes.
b. Please see the Company's responses to Renewable Energy Coalition's
Request for Production Nos. 2.8 and 2.9 for the categories of costs (categorized by
IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION
REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 3
Federal Energy Regulatory Commission ("FERC") account) that go into the O&M rate
and definitions of the type and nature of the costs.
c. The Company currently uses a work order system to accumulate costs for
various work requests. For each of the cost categories listed in subpart b above, the
Company would need to be able to use the work order system to specifically identify
actual costs associated with each individual Qualifying Facility ('QF") interconnection
facility, if such identification is even possible. The QF interconnection facilities, once
constructed, become a part of ldaho Power's overall system and are indistinguishable
from the rest of the system.
ldaho Power's QF interconnection facilities have not been separately identified
within its various propefi records and system mapping software, so even identifying
whether work is being performed on QF interconnection facilities may not be possible,
or may require significant amounts of research to determine. If such identification of QF
interconnection facilities was achievable, field employees would need to be trained to
specifically identify work performed on those interconnection facilities separately from
non-QF interconnection facilities. ln some cases, QF interconnection facilities may be
located at the exact same location, even on the same pole, as non-QF interconnection
facilities.
Currently, maintenance is performed via "blanket work orders," which are not
meant to be specific to an asset, but to a function, for example, "line maintenance." The
same blanket work order is used for all general line maintenance in a region.
Further, many of the costs included in "actual O&M costs" are operational in
nature-for example, operating the transmission and distribution system-or are
indirect-for example, allocation of supervisory and support costs, overheads,
administrative and general expense, insurance, and property taxes. These costs are
IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION
REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 4
not directly identifiable. A mechanism or methodology for calculating these amounts
would need to be established to identify the operational and indirect costs.
d. The Company has not performed a study to evaluate the amount of
additional investments that would be needed in systems, infrastructure, labor, etc., to
track and bill actual O&M costs for all 134 QF project interconnections. The Company
does not bill actual O&M costs for any of its counterparties. ln all cases, a public utility
commission- or FERC-approved calculation is used to reasonably approximate the
actual costs of operating and maintaining the ldaho Power system. As indicated in
subpart c above, within most of its records and systems, the Company does not
currently separately identify or track QF interconnection facilities upon which an O&M
charge is assessed versus its other transmission and distribution facilities.
The response to this Request is sponsored by Aubrae Sloan, Accounting
Manager, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION
REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 5
REQUEST NO. 24: ln "ldahydro, Shorock Hydro, !nc., J.R. Simplot Company
and Renewable Energy Coalition's Petition," the Petitioners stated on Page 8 that "ln
fact, lPCo and other ldaho utilities assess actual O&M costs to interconnection
customers under interconnections subject to the Federal Power Act..." Please answer
the fo!lowing questions:
a. Does ldaho Power agree with the statement? Please explain why or why
not.
b. lf Idaho Power agrees with the Petitioner's statement, please list the
categories of costs that make up actual O&M costs and describe the overall
methodology for assessing actual O&M costs to interconnection customers subject to
the Federal Power Act?
RESPONSE TO REQUEST NO. 24:
a. No. ldaho Power cannot speak to how other ldaho utilities assess O&M
costs; however, the Company disagrees with the statement as it relates to ldaho Power.
Please see the Company's answer to J.R. Simplot Company's ("Simplot") lnterrogatory
No.11.
b. Not applicable.
The response to this Request is sponsored by Aubrae Sloan, Accounting
Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION
REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 6
REQUEST NO. 25: ln "ldaho Power's Answer and Responses to J.R. Simplot's
First lnterrogatories, Requests for Admission, and Requests for Production to ldaho
Power Company," ldaho Power stated in its "Answer to lnterrogatory No. 9" that for both
large generators and small generators "The lnterconnection Customer shall be
responsible for its share of all reasonable expenses, including overheads associated
with (1) owning, operating, maintaining, repairing, and replacing its own lnterconnection
Facilities; and (2) operating, maintaining, repairing, and replacing the Transmission
Provider's lnterconnection Facilities." Please answer the following questions:
a. How does ldaho Power charge overheads associated with operating,
maintaining, repairing, and replacing the Transmission Provider's lnterconnection
Facilities (item 2 above). Please provide specific examples to support your answer.
b. What is the justification for assessing O&M interconnection costs for QF
facilities differently than interconnection customers subject to the Federal Power Act?
RESPONSE TO REQUEST NO. 25:
a. ldaho Power does not charge overheads pursuant to item 2 above.
Please see the Company's answer to Simplot's lnterrogatory No. 11.
b. O&M fees for Public Utility Regulatory Policies Act of 1978 ('PURPA")
QFs in ldaho are authorized and directed by Schedule 72. O&M fees for non-PURPA,
FERC-jurisdictional interconnections are authorized and directed by ldaho Power's
Open Access Transmission Tariff.
The response to this Request is sponsored by Aubrae Sloan, Accounting
Manager, ldaho Power Company.
DATED at Boise, Idaho, this 1Oth day of 2018
n/
DONOVAN E. WALKER
Attorney for ldaho Power Company
IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION
REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY. T
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 1Oth day of August 2018 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
Edith L. Pacillo
Edward Jewell
Deputy Attorneys General
ldaho Public Utilities Commission
472 W est Washington (83702)
P.O. Box 83720
Boise, ldaho 83720-007 4
J.R. Simplot Gompany
Peter J. Richardson
Gregory M. Adams
RICHARDSON ADAMS, PLLC
515 North 27th Street (83702)
P.O. Box 7218
Boise, ldaho 83707
ldahydro and Shorock Hydro, !nc.
C. Tom Arkoosh
ARKOOSH LAW OFFICES
802 West Bannock Street, Suite 900
P.O. Box 2900
Boise, Idaho 83701
Renewable Energy Coalition
J. Kahle Becker
Attorney at Law
223 North 6th Street, Suite 325
Boise, ldaho 83702
lrion Sanger
SANGER LAW, P.C.
1117 SW 53'd Avenue
Portland', Oregon 97215
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edward. iewell@puc. idaho. gov
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IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION
REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY - 8
Tamarack Energy Partnership
Michael C. Creamer
Preston N. Carter
GIVENS PURSLEY LLP
601 West Bannock Street (83702)
P.O. Box 2720
Boise, ldaho 83701
Avista Corporation
Michael G. Andrea, Senior Counse!
Avista Corporation
1411 East Mission Avenue, MSC-23
Spokane, Washington 99202
Clint Kalich
Manager, Resource Planning and Analysis
Avista Corporation
1411 East Mission Avenue, MSC-7
Spokane, Washington 99202
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Bearry,
IDAHO POWER COMPANY'S RESPONSE TO THE THIRD PRODUCTION
REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY.9
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