20190211IPC to Staff 1-8.pdf

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LISA D. NORDSTROM
Lead Counsel
[e-mail]
February 11,2019
VIA HAND DELIVERY
Diane Hanian, Secretary
ldaho Public Utilities Commission
472 West Washington Street
Boise, ldaho 83702
Re Case No. IPC-E-19-02
Annual Compliance Filing to Update the Substation Allowance under
Schedule 19, Large Power Service - ldaho Power Company's Response to
the First Production Request of the Commission Statf
Dear Ms. Hanian
Enclosed forfiling in the above matter please find an original and three (3) copies of
ldaho Power Company's Response to the First Production Request of the Commission
Staff.
The attachments to Response Nos. 1,2,6 and 7 are confidential. Please handle
the confidential information in accordance with the Protective Agreement executed in this
matter.
Very truly yours,
Lisa D
LDN:kkt
Enclosures
P.O. Box 70 (83707)
1221 W. ldaho St.
Boise, lD 83702
LISA D. NORDSTROM (lSB No. 5733)
ldaho Power Company
1221West ldaho Street (83702)
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: [phone]
I nord strom @ ida h opower. com
REC E IV ED
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Attorney for ldaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY TO
UPDATE THE SUBSTATION ALLOWANCE
UNDER SCHEDULE 19, LARGE POWER
SERVICE
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CASE NO. tPC-E-19-02
IDAHO POWER COMPANY'S
RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE
COMMISSION STAFF
COMES NOW, ldaho Power Company ("ldaho Power" or "Comp?[y"), and in
response to the First Production Request of the Commission Staff to Idaho Power
Company dated January 28,2019, herewith submits the following information:
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF - 1
REQUEST NO. 1: Please provide all evidence including calculations,
workpapers, supporting information, and/or analysis used to determine the material cost
of the 138kV/13.09kV, 30 MVA transformer identified under FERC Account 362.61.
RESPONSE TO REQUEST NO. 1: Because the Com pany has not recently
purchased a 138kV/13.09kV, 30 MVA transformer, the Company relied upon a
budgetary estimate provided by the vendor. The confidential attachment to this
response is the unloaded budgetary estimate received from the Company's supplier for
the 138kV/13.09kV, 30 MVA transformer. When the stores loading and taxes were
applied to the unloaded budgetary estimate of $700,000, the resulting fully loaded
material cost was $781,453. The confidential attachment will only be provided to those
parties that have executed the Protective Agreement in this matter.
The response to this Request is sponsored by Ed Helms, Engineering Leader,
ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF - 2
REQUEST NO. 2: Over the past 5 years, how many large substation
transformers (similar to the 138kV/13.09kV, 30 MVA transformer) has the Company
purchased? Please provide the number of units purchased each year, a description,
and the cost of each unit. Please support the Company response with actual invoice
copies.
RESPONSE TO REQUEST NO. 2: Please see the confidential attachments for
a list of the large substation transformers that the Company has purchased in the last
five years and for copies of invoices. The confidential attachments will only be provided
to those parties that have executed the Protective Agreement in this matter.
The response to this Request is sponsored by Grant Anderson, Regulatory
Analyst, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF - 3
REQUEST NO. 3: For the 138kV/13.09kV, 30 MVA transformer, FERC Account
362.61 please provide justification for the 18o/o or $119,932 increase.
RESPONSE TO REQUEST NO. 3: As noted in response to Request No. 1,
because the Company has not recently purchased a 138kV/13.09 kV,30 MVA
transformer, the Company relied upon a budgetary estimate provided by the vendor for
the calculation of the substation allowance for the past two years. The primary driver for
the increase in the cost was due to the commodity pricing for magnetic steel, core steel
and oil.
The response to this Request is sponsored by Ed Helms, Engineering Leader,
ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF - 4
REQUESI IIQ-4: Please explain the variability in material cost for the
138kV/13.09kV, 30 MVA transformer over the past 3 years (i.e. TA-16-08 minus 5%, TA
17-05 minus 5o/o,TA18-04 plus 18Yo).
RESPONSE TO REQUEST NO. 4: The primary driver for the variability in
material cost for the 138kV/13.09kV, 30 MVA transformer over the past three years is
due to the commodity pricing for copper, magnetic steel, core steel, and oil. Please see
the attached commodity index pricing in support of the pricing variability.
The response to this Request is sponsored by Ed Helms, Engineering Leader,
Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF - 5
REQUEST NO. 5: Does the Company believe a quotation for the
138kV/13.09kV, 30 MVA transformer from a single vendor provides least-cost pricing? !f
so please explain why. If not, please explain why not.
RESPONSE TO REQUEST NO. 5: The Company obtains low-cost services by
enacting procurement processes and standards to ensure that purchase and
contracting decisions are made in a manner that is based upon the best overall value.
These processes provide a framework for differing types of procurement activities to
ensure the maximum value for each dollar spent, considering cost, experience, quality,
and other factors. For major equipment purchases, the Company goes out to bid to
qualified vendors to get the equipment that both provides the lowest cost of ownership
to the Company, and provides a manufacturing schedule that meets the technical
specifications and commercial terms that are required for the project. For estimating
purposes, the Company relies on vendors to supply budgetary quotes or engineering
estimates for material that has not been purchased recently - this is the case for the
1 38kV/1 3.09kV, 30 MVA transformer.
The response to this Request is sponsored by Ed Helms, Engineering Leader,
ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF - 6
REQUEST NO. 6: Please provide all evidence including calculations,
workpapers, supporting information, and/or analysis,used to determine the material cost
of the 4-unit Metalclad unit identified under FERC Account 362.67.
RESPONSE TO REQUEST NO. 6: The unloaded quote for the 4-unit metalclad
was $698,702. Stores loading and taxes applied to the $698,702 results in a total
loaded cost of $779,474. The confidential attachment to this response provides support
for the quote for the 4-unit metalclad. The confidential attachment will only be provided
to those parties that have executed the Protective Agreement in this matter.
The response to this Request is sponsored by Ed Helms, Engineering Leader,
ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF - 7
REQUEST NO. 7: Over the past 5 years, how many 4-unit Metalclad units has
the Company purchased? Please provide the number of units purchased each year, a
description, and the cost of each unit. Please support the Company response with
actual invoice copies.
RESPONSE TO REQUEST NO. 7: The Company has purchased eight (8) 4-unit
Metalclad units over the past five years. Please see confidential attachments to this
response for the table of units purchased and copies of invoices. The confidential
attachments will only be provided to those parties that have executed the Protective
Agreement in this matter.
The response to this Request is sponsored by Grant Anderson, Regulatory
Analyst, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF - 8
REQUEST NO. 8: Please explain and provide documentation supporting the
81% increase in "Miscellaneous parts and material:" for FERC Accounts 362-55,058,
59.
RESPONSE TO REQUEST NO. 8: ln previous filings, the material amount for
this line item should have been the difference of the total material estimated minus the
sum of all the accounts shown above. For the last three years, the cost for this category
was understated, and this error resulted in a change of less than 0.2 percent. While this
line item increased 81 percent year-over-year, this line item represents approximately
0.3 percent of the total substation cost.
The response to this Request is sponsored by Ed Helms, Engineering Leader,
ldaho Power Company.
DATED at Boise, ldaho, this 11th day of February 2019.
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Attorney for ldaho Power Company
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF - 9
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 11th day of February 2019, I served a true and
correct copy of IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF upon the following named
parties by the method indicated below, and addressed to the following:
Commission Staff
Karl T. Klein
Deputy Attorney General
ldaho Public Utilities Commission
472 West Washington (83702)
P.O. Box 83720
Boise, Idaho 83720-007 4
X Hand Delivered
_U.S. Mail
_Overnight Mail
_FAXX Email [e-mail]
lndustrial Customers 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
_Hand DeliveredX U.S. Mail
_Overnight Mail
_FAXX Email [e-mail]
o
T Assistant
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE COMMISSION STAFF - 1O
_Hand DeliveredX U.S. Mail
_Overnight Mail
_FAXX Email [e-mail]
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
GASE NO. IPG-E-19-02
IDAHO POWER COMPANY
ATTACHMENT
RESPONSE TO
STAFF'S REQUEST NO.4
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BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
cAsE NO. !PC-E-19-02
IDAHO POWER COMPANY
ATTACHMENTS
RESPONSES TO
STAFF'S REQUEST NOS. 1,2,6 & 7
THE ATTACHMENTS
ARE CONFIDENTIAL AND
WILL BE PROVI DED TO
THOSE PARTIES THAT
HAVE EXECUTED THE
PROTECTIVE AGREEMENT
IN THIS MATTER