20230511IPC to Staff 46 Supplemental.pdf

Donovan E. Walker
Lead Counsel
[e-mail]

May 11, 2023

VIA ELECTRONIC FILING

Jan Noriyuki, Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd., Bldg 8,
Suite 201-A (83714)
PO Box 83720
Boise, Idaho 83720-0074

Re: Case No. IPC-E-23-01
In the Matter of Idaho Power Company’s Application for a Certificate of
Public Convenience and Necessity for the Boardman to Hemingway 500-
kV Transmission Line

Dear Ms. Noriyuki:

Enclosed for electronic filing, please find Idaho Power Company’s Supplemental
Response to the Fourth Production Request of Commission Staff.

The confidential attachment will be uploaded to the FTP Site and provided to the
parties who sign the Protective Agreement.

If you have any questions about the attached filing, please do not hesitate to
contact me.

Very truly yours,

Donovan E. Walker
DEW:sg
Enclosures
RECEIVED
2023 May 11, 2:56PM
IDAHO PUBLIC
UTILITIES COMMISSION

CERTIFICATE OF ATTORNEY

ASSERTION THAT INFORMATION CONTAINED IN AN IDAHO PUBLIC UTILITIES
COMMISSION FILING IS PROTECTED FROM PUBLIC INSPECTION
Case No. IPC-E-23-01
Idaho Power Company’s Application for a Certificate of Public Convenience and
Necessity for the Boardman to the Hemingway 500-kV Transmission Line

The undersigned attorney, in accordance with RP 67, believes that Attachment 1
to Idaho Power Company’s Supplemental Response to the Fourth Production Request
of the Commission Staff dated May 11, 2023, may contain information that Idaho Power
Company or a third party claims is confidential as described in Idaho Code § 74-101, et
seq., and § 48-801, et seq., and as such is exempt from public inspection, examination,
or copying.

DATED this 11th day of May 2023.

Donavan Walker
Counsel for Idaho Power Company

IDAHO POWER COMPANY’S SUPPLEMENTAL RESPONSE TO THE FOURTH PRODUCTION
REQUEST OF THE COMMISSION STAFF - 1
DONOVAN E. WALKER (ISB No. 5921)
Idaho Power Company
1221 West Idaho Street (83702)
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: [phone]
[e-mail]

Attorney for Idaho Power Company

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF IDAHO POWER
COMPANY’S APPLICATION FOR A
CERTIFICATE OF PUBLIC
CONVENIENCE AND NECESSITY FOR
THE BOARDMAN TO HEMINGWAY 500-KV
TRANSMISSION LINE.
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CASE NO. IPC-E-23-01

IDAHO POWER COMPANY’S
SUPPLEMENTAL RESPONSE
TO THE FOURTH PRODUCTION
REQUEST OF THE
COMMISSION STAFF

COMES NOW, Idaho Power Company (“Idaho Power” or “Company”), and in
response to the Fourth Production Request of the Commission Staff (“IPUC or
Commission”) dated April 14, 2023, herewith supplements the following information:

IDAHO POWER COMPANY’S SUPPLEMENTAL RESPONSE TO THE FOURTH PRODUCTION
REQUEST OF THE COMMISSION STAFF - 2
REQUEST FOR PRODUCTION NO. 46: The Company's response to Production
Request No. 29 confirms that Mid-Columbia ("Mid-C") market prices have been
substantially higher than the Integrated Resource Plan ("IRP") forecasted prices on a
sustained basis for 2021 and 2022. The Company's response to Production Request
No. 30 states:
The B2H project is modeled in AURORA as additional transmission
capacity available for Idaho Power energy purchases and sales from the
Pacific Northwest. To the extent this incremental export transmission
capacity enabled additional Company resource sales over the existing
transmission system, benefits would be captured in Aurora modeling
process and reflected in total portfolio costs.

Please provide the following information:

a. Please explain the hypothetical impact of Mid-C market prices on the
determination of portfolio cost via AURORA. Should higher market prices tend to
increase or decrease the portfolio cost? Please explain the Company's reasoning; and
b. To validate the hypothesis, please run the AURORA dispatch model for
the Base B2H scenario, but vary the market price, holding all other factors constant.
The dispatch model runs should include the normal forecast (50th percentile), a high-
price forecast (75th percentile), and a low-price forecast (25th percentile). Please
provide for each run across the 20-year evaluation period, the net present value, the
annual benefit and cost value streams broken out separately, and the Megawatt-hours
("MWh") and the dollar value of purchases and sales in each year.
SUPPLEMENTAL RESPONSE TO REQUEST FOR PRODUCTION NO. 46:
Subsequent to submitting the Company’s Response to Request for Production No.
46, Commission Staff requested additional data from the stochastic analysis referenced
in the response, including for six of the stochastic runs, the (1) annual market purchases
IDAHO POWER COMPANY’S SUPPLEMENTAL RESPONSE TO THE FOURTH PRODUCTION
REQUEST OF THE COMMISSION STAFF - 3
and sales in megawatt-hours (“MWh”) for the 20-year analysis, and the (2) average
annual price of the market purchases and sales. Commission Staff requested the data for
the six total runs (three runs each for the preferred portfolio and the next least cost non-
B2H portfolio) that cover the extreme cases, including the lowest cost base portfolio, the
highest cost base portfolio, and one of the runs in which a B2H portfolio was less cost
effective than a non-B2H portfolio. Finally, Commission Staff requested Idaho Power
provide a comparison of the gas prices used in the stochastic analysis performed in
September 2022 and those used for the 2021 Integrated Resource Plan (“IRP”).
Confidential Attachment 1, provided via Idaho Power’s FTP site due to its
voluminous nature, includes the data supporting the stochastic analysis. The following
provides a legend for the spreadsheet:
1. The R1-R4 tabs are a yearly unit-by-unit breakdown of cost and dispatch.
a. Column CG lists the associated Risk Iteration (between 1 and 20).
b. Column AJ lists the Fuel Price. To find the annual weighted average fuel
price, scroll for example to a Natural Gas unit (i.e., Bennett Mountain or
Langley Gulch).
2. The P1-P4 tabs are a yearly unit-by-unit total cost and energy summary
a. The PX tabs include the quantity and cost of Market Purchases and Market
Sales (in the Item column C).
b. The associated Risk Iteration is listed in Column M.
3. F1-F4 tabs are gas prices for each of the risk iterations. The number scheme is as
follows:
1. Base or Preferred Portfolio with Normal Hydro and 2021 IRP gas prices,
IDAHO POWER COMPANY’S SUPPLEMENTAL RESPONSE TO THE FOURTH PRODUCTION
REQUEST OF THE COMMISSION STAFF - 4
2. Without B2H Pac Alignment Portfolio with Normal Hydro and 2021 IRP gas
prices,
3. Base Portfolio with Low Hydro conditions and the September 27, 2022, gas
forecast update, and
4. Without B2H Pac Alignment Portfolio with Low Hydro conditions and the
September 27, 2022, gas forecast update.
The stochastic runs include varying natural gas prices, hydro conditions, and
demand. For runs 3 and 4 with low hydro or updated gas prices, the stochastic analysis
spreads the updated values.
The stochastic analysis compares two portfolios, the Preferred Portfolio (the most
optimal portfolio inclusive of B2H) and the Base without B2H – PAC Bridger Alignment
(the optimal portfolio exclusive of B2H). The details of each portfolio are provided in the
charts below.1 Of note, the Non-B2H portfolio has significantly more renewables and
storage (500 MW of additional wind, 500 MW of additional solar, and 480 MW of additional
storage), differences not noted in the portfolio name – especially the renewable build-out
in each portfolio. When gas prices, hydro conditions, etc., are varied, the portfolio with
less renewables tends to be subject to more pricing volatility. That is because the
renewables assume pricing is locked in when they are constructed. The stochastic runs
from a study analysis however do not capture the volatility of the cost to install the
renewables and storage. For example, in addition to higher recent market energy prices,
the Company is also experiencing cost increases associated with installation of new
resources. Idaho Power’s expectation in the 2021 IRP was that a 4-Hour Lithium Battery

1 2021 IRP Technical Appendix C, Pages 66 and 71.
IDAHO POWER COMPANY’S SUPPLEMENTAL RESPONSE TO THE FOURTH PRODUCTION
REQUEST OF THE COMMISSION STAFF - 5
would cost $1,150 per kW2 installed. The Company’s expectation in the 2023 IRP is that
a 4-Hour Lithium Battery will cost $1,600 per kW3 installed, a significant increase
considering that in the 2021 IRP a 5.45-6.83 percent annual cost reduction factor was
applied for the first few years.4

2 2021$ - 2021 IRP Technical Appendix C, Page 43.
3 2023$ before applying investment tax credits.
4 2021 IRP Technical Appendix C, Page 44.
IDAHO POWER COMPANY’S SUPPLEMENTAL RESPONSE TO THE FOURTH PRODUCTION
REQUEST OF THE COMMISSION STAFF - 6

Considering the storage cost increase alone would suggest an additional $90
million in cost that would need to be added to the total Non-B2H portfolio costs.
Renewable pricing has moved quite a bit as well, however because B2H functions as
more of a capacity resource, similar to storage, it is not competing with renewables in the
IRP analysis.
The response to this Request is sponsored by Jared Ellsworth, Transmission,
Distribution and Resource Planning Director, Idaho Power Company.

IDAHO POWER COMPANY’S SUPPLEMENTAL RESPONSE TO THE FOURTH PRODUCTION
REQUEST OF THE COMMISSION STAFF - 7
DATED at Boise, Idaho this 11th day of May 2023.

DONOVAN E. WALKER
Attorney for Idaho Power Company

IDAHO POWER COMPANY’S SUPPLEMENTAL RESPONSE TO THE FOURTH PRODUCTION
REQUEST OF THE COMMISSION STAFF - 8
CERTIFICATE OF SERVICE

I HEREBY CERTIFY that on the 11th day of May 2023, I served a true and correct
copy of Idaho Power Company’s Supplemental Response to the Fourth 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
Riley Newton
Michael Duval
Deputy Attorney General
Idaho Public Utilities Commission
Po Box 83720
Boise, Idaho 83720-0074

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Idaho Irrigation Pumpers Association, Inc.
Eric L. Olsen
ECHO HAWK & Olsen, PLLC
505 Pershing Ave., Ste. 100
P.O. Box 6119
Pocatello, Idaho 83205

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Lance Kaufman, Ph.D.
2623 NW Bluebell Place
Corvallis, OR 97330
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Industrial Customers of Idaho Power
Peter J. Richardson
RICHARDSON ADAMS, PLLC
515 North 27th Street
P.O. Box 7218
Boise, Idaho 83702

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Dr. Don Reading
6070 Hill Road
Boise, Idaho 83703
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IDAHO POWER COMPANY’S SUPPLEMENTAL RESPONSE TO THE FOURTH PRODUCTION
REQUEST OF THE COMMISSION STAFF - 9
City of Boise
Ed Jewell
Darell Early
150 N. Capitol Blvd.
P.O. Box 500
Boise, Idaho 83701-0500

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Wil Gehl
Boise City Dept. of Public Works
150 N. Capitol Blvd.
P.O. Box 500
Boise, Idaho 83701-0500
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Micron Technology, Inc.
Austin Rueschhoff
Thorvald A. Nelson
Austin W. Jensen
Holland & Hart LLP
555 17th Street, Suite 3200
Denver, CO 80202

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Jim Swier
Micron Technology, Inc.
8000 South Federal Way
Boise, ID 83707
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Idaho Conservation League
Marie Kellner
Idaho Conservation League
710 N. 6th Street
Boise, Idaho 83702
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IDAHO POWER COMPANY’S SUPPLEMENTAL RESPONSE TO THE FOURTH PRODUCTION
REQUEST OF THE COMMISSION STAFF - 10
Brad Heusinkveld
Idaho Conservation League
710 N. 6th Street
Boise, Idaho 83702
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________________________________
Stacy Gust, Regulatory Administrative
Assistant
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-23-01
IDAHO POWER COMPANY
REQUEST NO. 46
ATTACHMENT NO. 1
SEE ATTACHED SPREADSHEET