20210813IPC to Sierra Club 1-12.pdf

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An lo coRP compeny
JULIAA. HILTON
Deputy General Counsel and
Director of Legal
[e-mail]
,-,, .,;.iii'$,mlOll
August 13,2021
VIA ELECTRONIC FILING
Jan Noriyuki, Secretary
ldaho Public Utilities Commission
11331 W. Chinden Blvd., Bldg 8,
Suite 201-A(83714)
PO Box 83720
Boise, ldaho 83720-0074
Re Case No. IPC-E-21-17
ln the Matter of Idaho Power Company's Application for Authority to
lncrease lts Rates for Electric Service to Recover Gosts Associated with the
Jim Bridger Power Plant
Dear Ms. Noriyuki:
Pursuant to Order No. 35058, please find ldaho Power Company's Response to
the First Production Request of Sierra Club to ldaho Power Company enclosed for
electronic filing. Due to the voluminous nature of confidential and non-confidential
information provided in response to previous data requests in this case, the Company
has posted the attachments to these responses to the secure FTP site to allow parties to
view the requested information. Because certain attachments contained confidential
information, the FTP site has been divided between confidential and non-confidential
information. The login information for the non-confidential portion of the FTP site was
provided to all parties on July 21, 2021, and the login information for the confidential
portion was provided to those parties that executed the Protective Agreement in this
matter on July 21,2021.
!f you have any questions about the attached documents, please do not hesitate
to contact me.
Very truly yours,
c/-L.,-){(+
JAH:sg
Enclosure
Julla A. l-{rlton
JULIA A. HILTON (lSB No. 7740)
ldaho Power Company
1221West ldaho Street (83702)
P.O. Box 70
Boise, ldaho 83707
Telephone: [phone]
Facsimile: [phone]
ihilton@ida hooower.com
Attorney for ldaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE IDAHO PO\A'ER
COMPANY'S APPLICATION FOR
AUTHORITY TO INCREASE ITS RATES
FOR ELECTRIC SERVICE TO RECOVER
COSTS ASSOCIATED WTH THE JIM
BRIDGER PLANT
CASE NO. |PC-E-21-17
IDAHO POWER COMPANY'S
RESPONSE TO THE FIRST SET
OF PRODUCTION REQUESTS
OF THE SIERRA CLUB
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COMES NOW, ldaho Power Company ("ldaho Powef or "Company"), and in
response to the First Set of Production Requests of Sierra Club to ldaho Power dated
July 23, 2021, herewith submits the following information:
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 1
REQUEST NO, 1: Provide electronic copies of all data requests and responses
received from or sent to other parties in this proceeding. lf electronic copies are not
available, please contact counselfor Sierra Club to coordinate response. This is an
ongoing request.
RESPONSE TO REQUEST NO. {: To date, the Company has received data
requests from the lndustrial Customers of ldaho Power and Staff of the ldaho Public
Utilities Commission ("Commission"). Copies of ldaho Power's Response to the First
Production Request of the lndustrial Customers of ldaho Power was served on the then-
existing parties on July 1g,2021, and copies of ldaho Power's Response to the First
Production Request of Commission Staff was served on the then-existing parties,
including Sierra Club, on July 21,2021. As part of the responses provided on July 21,
2021, all parties received instructions for accessing ldaho Power's file transfer protocol
(.FTP") site where copies of all confidential and non-confidential data responses can be
found. Passwords for the FTP site were sent in a separate email the same day. As a
matter of course, copies of Idaho Power's responses to discovery requests in this case
will be provided to all intervening parties.
The response to this Request is sponsored by Matt Larkin, Revenue
Requirement Senior Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 2
REQUEST NO. 2: Please refer to the Direct Testimony of Mr. Adelman at 4:14-
5:2. Please provide complete, unredacted copies of the agreements referred to,
specifically the Agreement for Ownership of the Jim Bridger Project, the Agreement for
the Construction of the Jim Bridger Project, and the Agreement for the Operation of the
Jim Bridger Project, as well as Amendments 1 through 9.
RESPONSE TO REQUEST NO. 2: Please see the Company's Response to the
lndustrial Customers of ldaho Power's First Production Request No.44 accessible on the
Company's FTP site.
The response to this Request is sponsored by Ryan Adelman, Vice President of
Power Supply, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 3
REQUEST NO. 3: Please provide complete, unredacted copies of the current fuel
supply agreements for the Jim Bridger power plant. lf the Company does not have a fuel
supply agreement for the Bridger mine, please provide the most recent fueling plan for
the Bridger mine.
RESPONSE TO REQUEST NO. 3: Please see ConfldentialAttachment 1 for the
unredacted copy of the current fuel supply agreement between Black Butte Coal
Company, ldaho Power and PacifiCorp, and ConfidentialAttachmenl2tor the current
life of mine fueling plan budget for Bridger Coal Company ("BCC"), the current fueling
plans for Bridger. The term of the current contract with Black Butte expires April 30,
2022. Deliveries from BCC end in 2028 in the current plan followed by final reclamation
and monitoring activities through 2050. Due to the voluminous nature of confidential
and non-confidential information provided in response to previous data requests in this
case, ldaho Power provided parties access to an FTP site where copies of all
confidential and non-confidentialdata responses can be found. ConfidentialAttachment
Nos. 1 and 2 can be found in the confidentia! portion of that site.
The response to this Request is sponsored by Randy Henderson, Principal Joint
Projects Coordinator, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 4
REQUEST NO. 4: Has ldaho Power evaluated whether securitizing its
remaining debt on the Jim Bridger plant would result in savings for the Company's
customers when compared to accelerated depreciation as proposed in this
proceeding?
a. lf so, please provide such analysis.
b. If not, explain why not.
RESPONSE TO REQUEST NO.4: No. The Company's request in this case
appropriately computes the Bridger-related revenue requirement in accordance with
the Commission-approved cost of capital for prior coal plant recovery mechanisms.
The Company did not analyze an alternative that departs from this Commission-
approved rate of return.
The response to this Request is sponsored by Matt Larkin, Revenue
Requirement Senior Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 5
REOU NO.5 : Please provide any analysis conducted by or for ldaho
Power, other than ldaho Power's most recent IRP, evaluating whether exiting Jim
Bridger earlier than the dates currently proposed in the Company's Second Amended
2019lRP would be economically beneficial for ldaho Power's customers.
RESPONSE TO REQUEST NO.5: There has been no analysis performed
outside of the lntegrated Resource Plan ("lRP") process that evaluated alternative
exit dates for Bridger. The primary goal of the IRP is to ensure Idaho Power's system
has sufficient resources to reliably serve customer demand and flexible capacity
needs over the 2}-year planning period. As part of this process, the Company
develops portfolios that are quantifiably demonstrated to eliminate the identified
resource deficiencies, and qualitatively varied by resource type, in which the
considered resource types reflect Idaho Power's understanding that the economic
performance of a resource class is dependent on future conditions in energy markets
and energy policy. To ensure the portfolios provide customers reliable and affordable
energy, the Company selects a subset of the top-performing AURORA-produced
portfolios to determine if additional resource modifications - primarily accelerated
coal retirements - could further reduce costs and help achieve ldaho Power's clean
energy commitments more quickly.
The result of this robust analysis is a preferred portfolio that indicates
favorable economics associated with the Company's exit from two of the four coal-
fired generating units at Bridger by the end of 2026 and exit from the remaining two
units at Bridger by 2030. However, ldaho Power recognizes its obligation to reliably
deliver affordable electricity to customers cannot be compromised as it strives to
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 6
achieve clean energy goals and emphasizes the need to continue to evaluate the
coal units' value in providing flexible capacity necessary to successfully integrate high
penetration of variable energy resources. As a result, the Company prepares an IRP
every two years, monitoring trends in the energy industry, updating cost inputs, and
adjusting the preferred portfolio as a result of the updated analyses, including the
potential earlier exit from a Bridger unit if proven to provide favorable economics
while maintaining reliability.
The response to this Request is sponsored by Matt Larkin, Revenue
Requirement Senior Manager, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 7
REQUEST NO. 6: Please refer to Mr. Adelman's Direct Testimony on pages 6
and 7.
a. Has ldaho Power evaluated the costs of installing SCRs on Bridger
Units 1 and 2 if SCRs are required by the federa! government? If so,
please provide such analysis.
b. Did ldaho Power's modeling for its most recent IRP assume that SCRs
would or would not be required on Bridger Units 1 and 2?
c. lf the answer to subpart (b) is that ldaho Power assumed that SCRs
would not be required, has Idaho Power completed any modeling
assuming that SCRs will be required? If so, please provide such
analysis.
RESPONSE TO REQUEST NO. 6:
a - c. No. ldaho Power assumed Selective Catalytic Reductions ("SCR") would
not be required by the federalgovernment on Bridger Units 1 and 2 in the Second
Amended 2019|RP. ln addition, no subsequent cost analyses or modeling have been
conducted pertaining to Bridger SCRs.
The response to this Request is sponsored by Randy Henderson, Principal Joint
Projects Coordinator, Idaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 8
REQUEST NO.7: Please confirm whether ldaho Power has reached any partial,
tentative, preliminary, or final agreement with PacifiCorp that would permit the Company
to exit from the Jim Bridger plant in 2022 (unit 1\, 2026 (unit 2), 2028 (unit 3) and 2030
(unit 4).
a. lf any agreement has been reached, please provide a copy of the written
agreement or describe the agreement if such agreement is not written;
b. lf no agreement has been reached, please describe the current status of
ongoing negotiations with PacifiCorp.
RESPONSE TO REQUEST NO. 7: Please see the Company's Response to the
lndustrial Customers of ldaho Power's First Production Request Nos. 7 and 20
accessible on the Company's FTP site.
The response to this Request is sponsored by Ryan Adelman, Vice President of
Power Supply, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 9
REQUEST NO. 8: PIease indicate whether Idaho Power and PacifiCorp have
come to an agreement on an expected closure date for the Bridger coal mine.
RESPONSE TO REQUEST NO. 8: On July 31,2018, ldaho Power provided an
updated confidential long-term fueling plan for the Jim Bridger plant to the Commission
in Docket No. UE 333. This least-cost, least-risk fueling plan option prepared by
PacifiCorp and ldaho Power identified a Bridger mine end of operations date of
December 31,2028. This continues to be the estimated end-of-life date the partners
consider as they jointly oversee the operations of the mine and fueling of the Bridger
plant.
The response to this Request is sponsored by Randy Henderson, Principal Joint
Projects Coordinator, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB . 10
REQUEST NO. 9: lf no agreement has been reached, please indicate when
Idaho Power expects the Bridger coal mine to close and whether that differs from when
Pacificorp expects the mine to close.
RESPONSE TO REQUEST NO. 9: Please see the Company's Response
Request No. 8.
The response to this Request is sponsored by Ryan Adelman, Mce President of
Power Supply, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB . 11
REQUEST NO. t0: Please refer to the Direct Testimony of Mr. Larkin at 11:7-
9 indicating that "Bridger will require incremental investments to maintain operations
prior to the decommissioning of the plant."
a. Please explain whether these incremental investments are intended to
continue operations at Jim Bridger through 2030 or some later date.
b. lf incremental investments are intended to continue operations at Jim
Bridger beyond 2030, please explain why ldaho Power customers
should contribute to maintaining operations at the plant beyond 2030.
RESPONSE TO REQUEST NO. 10: The forecasted Bridger investments for each
unit included in the Bridger levelized revenue requirement only consider capital
expenditures through ldaho Power's assumed exit date for each unit. ldaho Power is not
able to determine with certainty the costs it may incur after it exits the final unit (if
PacifiCorp elects to operate the units longer) until negotiations regarding the sharing of
costs and ongoing ownership responsibilities are finalized between the two partners. As
a result of this uncertainty and the length of time before these costs would be incurred,
ldaho Power did not assume any potential Bridger costs responsibilities beyond its exit
date from the fina! unit (2030) in the levelized revenue requirement calculation. The
Bridger levelized revenue requirement would be adjusted over time through the
proposed balancing account mechanism to reflect actua! costs the Company incurs as
a result of the business terms negotiated. ldaho Power believes these assumptions
represent a reasonable basis for determining the proposed Bridger levelized revenue
requirement.
The response to this Request is sponsored by Randy Henderson, Principal Joint
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB . 12
Projects Coordinator, ldaho Power Company
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 13
REQUEST NO. 11: Please refer to the Direct Testimony of Mr. Larkin at
26:12-21, indicating that ldaho Power assumes that it will be responsible for fixed
O&M costs as Iong as PacifiCorp continues operating Jim Bridger units, but that all
O&M costs responsibilities will cease in 2030.
a. Please explain why ldaho Power has made this assumption;
b. Please explain why ldaho Power customers should be responsible for
fixed O&M costs at Jim Bridger units even after ldaho Power exits from
these units?
RESPONSE TO REQUEST NO. 11: Please see the Company's Response to
the lndustrial Customers of Idaho Power's First Production Request Nos. 7 and 39
accessible on the Company's FTP site.
The response to this Request is sponsored by Ryan Adelman, Vice President of
Power Supply, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 14
REQUEST NO. 12: Please refer to the Direct Testimony Mr. Adelman at
15:18-16:8. Did ldaho Power evaluate Regional Haze compliance options for Jim
Bridger that did not include the continued burning of coal, including conversion to
natural gas or retirement?
RESPONSE TO REQUEST NO. 12: The only Regional Haze compliance
options ldaho Power evaluated for Bridger were the continued burning of coal and
coa! unit retirements.
The response to this Request is sponsored by John Carstensen, Joint Projects
Leader, ldaho Power Company.
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRACLUB - 15
Respec{tu|ff submitted this 13s day of August 2021.
Julia A. Hilton
Attomey for ldaho Power Gompany
IDAHO POI,-I/ER COMPANYS RESPONSE TO TTIE FIRST SET OF PRODUCTION REQUEST8 OF
THE SIERRAELUB.16
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 13th day of August 2021,1 served a true and
correct copy IDAHO POWER COMPANY'S RESPONSE TO THE FIRST
PRODUCTION REQUEST OF THE SIERRA CLUB upon the following named parties
by the method indicated below, and addressed to the following:
Commission Staff
Erick Shaner
Deputy Attorney General
Idaho Public Utilities Commission
11331 W. Chinden Blvd., Bldg No.8,
Suite 201-A(837141
PO Box 83720
Boise, lD 83720-0074
lndustrial Customer 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
ldaho Conservation League
Benjamin J. Otto
ldaho Conservation League
710 N. 6th Street
Boise, ldaho 83701
City of Boise
Ed Jewell
Boise City Attorney's Office
150 N. Capitol Blvd.
Boise, ldaho 83701
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IDAHO POIA'ER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB - 17
Clean Energy Opportunities for ldaho, Inc.
Kelsey Jae
Law for Conscious Leadership
920 N. Clover Dr.,
Boise, ldaho 83703
Michael Heckler
Courtney \Mite
3778 Plantation River Drive, Suite 102
Boise, !D 83703
Sierra Club
Rose Monahan
Ana Boyd
2101 Webster Street, Suite 1300
Oakland, CA94612
Micron Technology, lnc.
Austin Rueschhoff
Thorvald A. Nelson
Austin W. Jensen
Holland & Hart LLP
555 17th Street, Suite 3200
Denver, CO 80202
Jim Swier
8000 S. FederalWay
Boise, lD 83707
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Stacy Gust, Regulatory Administrative
Assistant
IDAHO POWER COMPANY'S RESPONSE TO THE FIRST SET OF PRODUCTION REQUESTS OF
THE SIERRA CLUB . 18