20210622ICIP 1-50 to IPC.pdf

Peter J. Richardson ISB # 3195
Gregory M. Adams ISB # 7454
RICHARDSON ADAMS, PLLC
515 N. 27th Street
Boise, Idaho 83702
Telephone: [phone]
Fax: [phone]
peter@richardsonandol eary.conr
gre g@richardsonandoleary. com
IN THE MATTER OF IDAHO POWER
COMPANY'S APPLICATION FOR
AUTHORITY TO INCREASE ITS RATES
FOR ELECTRIC SERVICE TO RECOVER
COSTS ASSOCIATED WITH THE JIM
BRIDGER PLANT
;fi-'
rr,-i-1!.I
Attomeys for the Industrial Customers of ldaho Power
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
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CASE NO. IPC.E.2I-17
FIRST PRODUCTION REQUEST OF
THE INDUSTRIAL CUSTOMERS OF
IDAHO POWER
Pursuant to Rule 225 of the Rules of Procedure of the [daho Public Utilities Commission
(the "Commission"), the Industrial Customers of ldaho Power ("lClP") by and through its
attomey of record, Peter J. Richardson, hereby requests that ldaho Power Company ("ldaho
Power" or the "Company") provide responses to the following with supporting documents,
where applicable.
This production request is to be considered as continuing, and Idaho Power is requested
to provide by way of supplementary responses additional documents that it or any person acting
on its behalf may later obtain that will augment the responses or documents produced.
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC-E.21-17 _ PAGE I
Please provide an additional electronic copy, or if unavailable, a physical copy, to Dr.
Don Readingat:6070 Hill Road, Boise, Idaho 83703, Tel: [phone]; Fax: [phone]l l;
dreadin B(4m indspri n g.corn.
For each item, please indicate the name of the person(s) preparing the answers, along
with the job title of such person(s) and the witness at hearing who can sponsor the answer.
Some of the following requests may include disclosures deemed to be confidential.
Counsel for the ICIP (Peter Richardson and Greg Adams) the [ClP's expert witness, Dr. Don
Reading, as well as counsel's legal assistant (Grace Hansen) are all prepared to execute an
appropriate confidentiality agreement should that be necessary in order to facilitate complete
responses.
REOUEST FOR PRODUCTION NO. I
Please provide, in electronic format with all formulae intact where possible, all workpapers and
other documents used in the development of Idaho Power's Application in this matter,
(hereinafter referred to as the "Application.")
REOUEST FOR PRODUCTION NO.2
Please provide copies of all communications with the Idaho Public Utilities Commission and its
Staff regarding the Application.
REOUEST FOR PRODUCTION NO.3
Please provide copies of all responses to production requests (both formal and informal)
provided to any other party to this proceeding.
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC-E-21-17 _ PAGE 2
REOUEST FOR PRODUCTION NO.4
At page 4 of the Application the Company asserts that the "Second Amended 2019 IRP
identified as a preferred portfolio that included early Bridger unit exits in2022,2026,2A28 and
2030." Please identif, which Bridger unit associated with each exit year and ldaho Power's
corresponding MW ownership in each unit.
REOUEST FOR PRODUCTION NO.5
At page 5 of the Application the Company asserts that, while they differ from ldaho Power's exit
dates, Bridger co-owner PacifiCorp identified exit dates beginning in 2023 in their 201 9 IRP.
Please identiff each Bridger unit PacifiCorp plans to exit and the year of the planned exit for
each identified unit.
REOUEST FOR PRODUCTION NO. 6
Will PacifiCorp and ldaho Power coordinate the exit date for each Bridger unit such that each
utility will have an identical exit date for each unit? Please document and explain your answer
for each of the four Bridger units.
REOUEST FOR PRODUCTION NO.7
If your answer to No. 6 above is negative or not knowable at this time, please explain what
ongoing responsibility (financial, liability, environmental remediation, variable or fixed O&M
etc.) a non-exiting utility will have with respect to a particular unit if the non-exiting utility
continues to operate that unit. By way of examples and not to limit the scope of your response;
( I ) will the non-exiting utility have any obligation to compensate the exiting utility for
incremental costs of maintenance or incremental environmental remediation costs or continued
exposure to liability for damages caused by continued operation of the unit, and (2) will the non-
exiting utility be obligated to compensate the exiting utility for the continued use of the exiting
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC.E-21.17 _ PAGE 3
utility's (prior-owned) share of the unit? Please provide copies of all documents (contracts,
agreements, memos, etc.) supporting your answer.
Rf,OUEST FOR PRODUCTION NO. 8
This request is the flip side of the coin to No 7 above. [f your answer to No. 6 above is negative
or not knowable at this time, please explain what ongoing responsibility (financial, liability,
environmental remediation, fixed and/or variable O&M etc.) an exiting utility will have to a non-
exiting utility with respect to a particular unit that the non-exiting utility continues to operate.
By way of example and not to limit the scope of your response, will the exiting utility have any
ongoing obligations to compensate the non-exiting utility for use of common facilities, and will
the non-exiting utility indemnify the exiting utility for any future damages (of any kind) caused
by the continued use of the unit - environmental damages, personal injury etc. etc. Please
provide copies of all documents (contracts, agreements, memos, etc.) supporting your answer.
REOUEST FOR PRODUCTION NO.9
When ldaho Power exits a unit that PacifiCorp has not exited, will PacifiCorp then have the
use of Idaho Power's one third share of that unit? If so, how will ldaho Power be compensated
for that use? Conversely, if PacifiCorp exits a unit before ldaho Power exits that unit, will ldaho
Power be able to dispatch PacifiCorp's two thirds share? How will PacifiCorp be compensated,
or will it be compensated, in such an event.
REOUEST FOR PRODUCTION NO. IO
At page 5 of the Company's Application it is asserted that PacifiCorp identified exit dates
beginning in 2023 in their 20 I 9 IRP, thereby "providing additional indication that all units of the
Bridger plant will not be operational through 2034." Use of the noun "indication" suggests that
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC.E-21.17 _ PAGE 4
there is uncertainty as to when or if all units of the Bridger plant will cease operation. Please
confirm when all of the Bridger units will cease operation.
REOUEST FOR PRODUCTION NO. II
Please confirm the specific date Idaho Power will exit each Bridger unit and identify the unit it
will be exiting on that date.
REOUEST FOR PRODUCTION NO. 12
If Idaho Power is unable identify a specific date it will exit each Bridge unit, please explain how
it will make that determination and when it expects that determination to be made.
REOUEST TOR PRODUCTION NO. 13
At page 6 of the Company's application it is asserted that "There will be required investments at
the plant in addition to the normal maintenance in order to keep the plant operational until that
time [2034 retirement date]." Will ldaho Power's responsibility for such investments be
decreased proportionately as it exits each unit of the plant, such that it will have zero
responsibility to keep the plant operational if it has exited all four units? If ldaho Power only
exits two of the units will its subsequent responsibility for keeping the plant operational be
reduced by fifty percent?
REOUEST FOR PRODUCTION NO. 14
At page 3 lines l4 - l9 of Mr. Larkin's testimony, he references ldaho Power's "exit from
operations" of the Bridger plant in 2030. Does Idaho Power anticipate the Bridger plant will
continue operations beyond 2030? [f so, who or what organization will be operating the plant?
REOUEST FOR PRODUCTION NO. 15
At page 5 lines l7 -18 of his testimony, Mr. Larkin notes "an expected exit from participation in
operations of Bridger that is several years earlier that what is currently reflected in customer
FIRST PRODUCTION REQUEST OF THE ICIP
TN CASE NO. [PC-E-21-17 _ PAGE 5
rates." Please speciff the year ldaho Power will "exit from participation in operations of
Bridger."
REOUEST FOR PRODUCTION NO. 16
At page 6 lines 8 - l0 of Mr. Larkin's testimony he refers to "economic and regulatory factors
that will determine the Bridger plant's actual operating life..." Please specify each economic
and regulatory factor Mr. Larking is referring to and identiff when the costs associated with such
factor will be known with specificity.
REOUEST FOR PRODUCTION NO. 17
At page 6 lines 14 -19 of his testimony, Mr. Larkin asserts that the "cost recovery mechanism
will levelized or smooth recovery of Bridger-related revenue requirements over its remaining
operating life and help to mitigate the rate impact of any unforeseen changes in economics or
regulatory policy." Is it Mr. Larkin's testimony that by 'mitigating the rate impact,' ldaho
Power's ratepayers will have, at the conclusion of the imposition of the balancing account
surcharge, paid less in real dollars than they otherwise would have paid? Please document your
response with appropriate workpapers and calculations.
REOUEST FOR PRODUCTION NO. 18
At page 6 on lines 8 - l0 of Mr. Larkin's testimony he states that, "Because the economic and
regulatory factors that will determine the Bridger plant's actual operating life are likely to shift
and change over the next several years, it is important to put in place now a cost recovery
mechanism that can mitigate the rate volatility that could otherwise exist under a more traditional
ratemaking approach." Please identify Idaho Power's anticipated "actual operating life" of the
Bridger plant. Please explain and document (provide examples and monetary impacts) the "rate
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC-E-21.17 _ PAGE 6
volatility" that has otherwise existed up to this point in time under the Idaho Commission's more
traditional ratemaking approach.
REOUEST FOR PRODUCTION NO. 19
Please explain how Mr. Larkin envisions how a "more traditional ratemaking approach" (cited in
No. l8 above) would address cost recovery(ies) associated with the Bridger plant.
REOUEST FOR PRODUCTION NO. 20
At page 6, beginning on line 19, of Mr. Larkin's testimony he refers to the possibility of future
negotiations with Idaho Power's joint owner of the Bridger plant over the plant's actual
operating life, among other factors. He concludes that, "the ultimate outcome of those
negotiations and their impact on operating life and cost is not known today." Civen that Idaho
Power's 2019 IRP provides that it will exit at least one Bridger unit in2O22 (approximately just
six months from today) when does the Company anticipate the identified negotiations will
commence? If such negotiations have commenced, please provide minutes and agenda from
those meetings and also explain why Mr. Larkin only references the possibility of "future
negotiations" at line 22, page 6 of his direct testimony.
REOUEST FOR PRODUCTTON NO.2I
At pages 6 - 7 of his testimony, Mr. Larkin states that the Company's proposed cost recovery
mechanism maintains "a relatively stable level of annual recovery, even though the underlying
cost drivers may change over time." Please identify and quantify the "underlying cost drivers"
Mr. Larkin is referring to and the anticipated time frames in which they may occur.
ITEOUES'T FOR PRODUCTION NO. 22
When "the underlying cost drivers change..." (cited in No. 2l above) how does the Company
plan to provide the Commission and stakeholders with opportunity(ies) to review those "cost
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC.E.2I-17 _ PAGE 7
drivers" for prudence and reasonableness? When does the Company anticipate such prudence
and reasonableness reviews [if they are indeed contemplated to occur as part of the cost recovery
mechanism] will take place?
REOUEST FOR PRODUCTION NO. 23
Do the current Bridger depreciation rates reflect any remediation (closure) costs? Please detail
and document your answer.
REOUEST FOR PRODUCTION NO. 24
Do the current Bridger depreciation rates reflect an offset (credit) for salvage/scrap value of the
Bridger plant in connection with the plant's ceasing operation and/or decommissioning? Please
detail and document your answer.
REOUEST FOR PRODUCTION NO. 25
Has the Company considered selling (either due to receipt of unsolicited external
inquiries/requests or internal initiatives) its interest in the Bridger plan to a third-party? Please
detail and document your answer and all of the Company's efforts in this regard.
REOUEST FOR PRODUCTION NO. 26
Mr. Larkin states at page 10, lines I -4, that,'oCustomers will continue to be served by the
Bridger plant in some capacity until year-end 2030." Please explain how each Bridger unit that
is retired prior to year-end 2030 (e.g. one unit in2022 and one unit in 2026 and one unit in 2028)
will continue to serve customers through year-end 2030?
REOUEST FOR PRODUCTION NO. 27
If your response to Request No. 26 is to the effect that the exited plants will no longer be used to
serve ldaho Power's ratepayers, please identify the regulatory theory that permits ldaho Power to
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC-E-21-T7 - PAGE 8
continue charging its ratepayers for costs associated with mothballed/decommissioned plants that
are no longer being used to serve ratepayers.
REOUEST FOR PRODUCTION NO. 28
Please explain how ratepayers in years 2023 through year-end 2030 will benefit from being
required to continue to pay for depreciation (and possibly other expenses) associated with the
Bridger unit that Idaho Power exits in 2022.
REOUEST FOR PRODUCTION NO.29
Please explain how ratepayers in years 2027 through year-end 2030 will benefit from being
required to continue to pay for depreciation (and possibly other expenses) associated with the
Bridger unit that Idaho Power exits in 2026.
REOUEST FOR PRODUCTION NO.30
Please explain how ratepayers in year 2029 through year-end 2030 will benefit from being
required to continue to pay for depreciation (and possibly other expenses) associated with the
Bridger unit that ldaho Power exits in 2028.
REOUEST FOR PRODUCTION NO.3T
Has the ldaho Commission made a prudence determination that it is in the public interest for
Idaho Power to exit the Bridger plant before the end of its useful life in 2034? Please document
your answer with citations of relevant Commission orders.
REOUEST FOR PRODUCTION NO.32
Please provide a copy of the "existing depreciation schedule" of the Bridger coal mine that is
referred to by Mr. Larkin at page l0 line 23 of his testimony.
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC-8.21-17 - PAGE 9
REOUEST FOR PRODUCTION NO.33
Please identifu and explain the meaning of the "expected closure date" Mr. Larkin is referring to
at page l0 line 24 of his testimony. Please explain the relationship, if there is one, between the
"expected closure date" and the "exit" dates for each unit and the "useful life" of the Bridger
plant and the "economic life" of the Bridger plant.
REOUEST FOR PRODUCTION NO.34
Please confirm, with regard to those ratepayers who are ldaho Power's "customers" after Idaho
Power exits the first Bridgeranit2022, that they will continue to pay for the depreciation and
amorlization of that plant through at least year-end 2030. If you confirm that understanding of
the Company's proposal, then please reconcile that fact with Mr. Larkin's assertion at page l3
lines I - 10, that the Company's balancing account will "mitigate the risk of future customers
bearing the costs of a plant that will no longer be providing service to them."
REOUEST FOR PRODUCTION NO.35
At page 20, lines 2l -25, of his testimony Mr. Larkin states that the "Company's cost forecast is
modeled based on exiting the first Bridger unit in 2025, consistent with the expected online date
of the Boardman-to-Hemingway transmission line in the summer of 2026." Please explain the
relationship between the Boardman-to-Hemingway ("82H") transmission line in-service date
and the date the company expects to exit the first Boardman unit. For example, if the B2H
transmission line's operation date is delayed, will the Company likewise delay its exit from the
first Boardman unit. Please explain the nexus between the two events.
REOUES'I' FOR PRODUCTION NO.36
Please provide a copy of the Kiewet Engineering Group "decommissioning and demolition
study" referenced by Mr. Larkin at page 23 of his testimony.
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC-8.21-17 _ PAGE IO
REOUEST FOR PRODUCTION NO.37
Please reconcile Mr. Larkin's statement on page l3 of his testimony where he states that in order
to "result in the appropriate matching of cost and rate recovery" that "without accelerating the
depreciation schedule ... cost recovery from customers could extend beyond the point at which
the Company is participating in Bridger's operations" with his recommendation on page 25 that
decommissioning cost recovery extend beyond ldaho Power's proposed 2030 exit date from all
Bridger units.
Rf,OUEST FOR PRODUCTION NO.38
Please explain what Mr. Larkin means on page 25, lines I I - 12, of his testimony when he states
that "extending the collection period . . . minimizes the financial impact to both Idaho Power and
its customers." For example, does he mean that customers will pay less overall once the
collection period is concluded? Or, does he mean that customers will pay less per pay period
(monthly bills) but end up paying more over all once the collection period is concluded? What
financial impact on Idaho Power has been minimized? Please document your response.
REOUEST FOR PRODUCTION NO.39
At page 26 of his testimony Mr. Larkin states that "Because the Company does not have a
contractual agreement with PacifiCorp for cost responsibilities once a unit is exited, ldaho Power
assumed that variable O&M ceases upon exit but that the Company is responsible for fixed
O&M as long as PacifiCorp is operating the unit. The levelized revenue requirement calculation
assumes all O&M cost responsibilities cease in 2030." For that time period Mr. Larkin
references, that is after ldaho Power exits the unit but as long as PacifiCorp is operating the unit,
please explain: (l) what payments PacifiCorp will be making to ldaho Power for the use of the
l/3 of the plant that tdaho Power has paid for up to the date of its exit, (2) If the answer is none,
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC-E-21-17 _ PAGE 1I
please explain why tdaho Power would exit the unit without being compensated by PacifiCorp
for doing so? (3) Why Idaho Power is responsible for "fixed O&M as long as PacifiCorp is
operating the unit" after Idaho Power has exited the unit? (4) What is the basis of ldaho Power's
'assumption' that "variable O&M ceases upon exit?" (5) What is the basis of ldaho Power's
assumption that "all O&M cost responsibilities cease in 2030?" (6) Please explain what steps
ldaho Power has taken (or will be taking) to turn its assumptions refenced above into certainties.
REOUEST FOR PRODUCTION NO.40
Please reconcile the statement of Mr. Adelman at page 30 of his testimony to the effect that
PacifiCorp will continue to operate units 3 and 4 of Bridger through 2037, with the statement by
Mr. Larkin at page 7 of his testimony that PafiCorp's IRP is providing, "additional indication
that all units of the Bridger plant will not be operational through 2034."
REOUEST FOR PRODUCTION NO.4I
Please conelate each unit of Bridger that ldaho Power plans on exiting with its exit date. Please
correlate Idaho Power's understanding of each unit of Bridger that PacifiCorp plans to exit with
its exit date. Please cite to, or provide copies of, the source of ldaho Power's understanding if
the source documents are not cited and are publicly available.
REOUEST FOR PRODUCTION NO.42
ln the event a participating utility exits a unit of Bridger before the other participating utility
exits that unit please explain; (l) whether the non-exiting utility will have the use of the entire
output of that unit, (2) if the non-exiting utility does have access to the entire output of that unit,
how (or will) it compensate the exiting utility for the use of the exiting utility's 'share' of the
unit.
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC-E-21-17 _ PAGE I2
REOUEST FOR PRODUCTION NO.43
At pages 7 - 8 of his testimony, Mr. Adelman states that, "The Co-Owners have not developed
contractual terms that would be necessary to allow for the potential earlier exit of a Bridger unit
by one co-owner, and not both Co-Owners. As committed to in the Action Plan of the Second
Amended 2019 IRP, Idaho Power has begun discussions with PacifiCorp about early exits from
the Bridger units." Please provide copies of all correspondence (emails included) between
PacifiCorp and Idaho Power that discuss ldaho Power's (or PacifiCorp's) early exit from any or
all of the Bridger units, and please include all documents that have been discussed or circulated
as parl of those discussions.
REOUEST FOR PRODUCTION NO.44
Please provide copies of the Bridger Agreements and all amendments thereto referenced on page
7 or Mr. Adelman's testimony.
REOUEST FOR PRODUCTION NO.45
Please identify how many personnel are ldaho Power employees at the (l ) Bridger plant (2)
affiliated coal mining operations and/or (3) ancillary serviced to facilitate the operation of plant
and mine located in the State of Wyoming.
REOUEST FOR PRODUCTION NO.46
What financial commitments has ldaho Power made or incurred in order to mitigate the
economic impact on the community of Rock Springs and its environs due to the possible closure
of the Bridger plant? Please document your answer.
FIRST PRODUCTION REQUEST OF THE ICIP
TN CASE NO. IPC.E-21-17 _ PAGE I3
REOUEST TOR PRODUCTION NO.47
What obligations, not identified in No. 46 above, does ldaho Power and/or PacifiCorp have to
mitigate the economic impact of the closure of the Bridger plant on the community of Rock
Springs and its environs.
REOUEST FOR PRODUCTION NO.48
Once the Bridger plant is no longer operating, will the affiliated coal mining operations also be
terminated? Please explain the economic impact on Idaho Power of continued operation of the
coal mining operations versus the termination of those mining operations.
REOUEST FOR PRODUCTION NO. 49
On page l8 of Mr. Larkin's testimony he states that "the levelized revenue requirement is
determined by calculating the present value of the revenue requirement of each of the individual
balancing account items and converting the values into a level payment stream from customers
over the remaining recovery period." (A) Please provide the spreadsheets, with formulas intact,
for each of the balancing accounts. (B) Please provide all workpapers used in the leelization of
each of the balancing accounts. (C) Please provide all input assumptions workpapers used in the
levelization of each of the balancing accounts and an explanation of why the particular value was
selected.
REOUEST FOR PRODI.JCTION NO.50
Please provide the spreadsheets used in Larkin Exhibit No. 2, with formulas intact.
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC.E-21-17 _ PAGE 14
REOUEST FOR PRODUCTION NO. 5I
Larkin Exhibit No. 2 contains line items that referred to IPC-E- I I -08 (Bridger revenue
requirement) and GNR-U-18-01 (Bridger revenue requirement reduction). Please indicate in
each of these cases where the values of $39,571,031 and $2,603,216 are found.
Dated this day ofJune 2021
J.rsB # 3195
RICHARDSON ADAMS, PLLC
I HEREBY CERTIFY that on the22ndday of June,202l, a true and correct copy of the within
and foregoing FIRST PRODUCTION REQUEST of the Industrial Customers of Idaho Power in
Case No. IPC-E-21-17 was served, pursuant to Commission Order No. 34602, by electronic copy
only, to:
Jan Noriyuki
Commission Secretary
Idaho Public Utilities Commission
Jan. noriyuk i (@nuc. i daho. goy
Lisa Nordstrom, Senior Counsel
ldaho Power Company
I nordstrom@ idahopower.com
doc kets@ idahopower.com
Matt Larkin, Revenue Requirement Senior Manager
Idaho Power Company
m lark i n(d i dahooower. com
Richardson
rsB # 3195
FIRST PRODUCTION REQUEST OF THE ICIP
IN CASE NO. IPC-E-21.17 _ PAGE 15
Karl Klein
Deputy Attorney General
Idaho Public Utilities Commission
karl. klein@puc. idaho.sov