The URL can be used to link to this page

Home My WebLink About20240207IPC to Staff 1-8.pdfMEGAN GOICOECHEA ALLEN Corporate Counsel mgoicoecheaallen@idahopower.com February 7, 2024 Monica Barrios-Sanchez, Secretary Idaho Public Utilities Commission 11331 W. Chinden Boulevard Building 8, Suite 201-A Boise, Idaho 83714 Re: Case No. IPC-E-24-02 Idaho Power Company’s Annual Compliance Filing to Update the Substation Allowance Under Schedule 19, Large Power Service Dear Ms. Barrios-Sanchez: Attached for electronic filing please find Idaho Power Company’s Response to the First Production Request of the Commission Staff in the above-entitled matter. The confidential attachments will be provided to the parties who sign the Protective Agreement. If you have any questions about the attached documents, please do not hesitate to contact me. Sincerely, Megan Goicoechea Allen MGA:sg Enclosures RECEIVED Wednesday, February 7, 2024 2:52:09 PM IDAHO PUBLIC UTILITIES COMMISSION CERTIFICATE OF ATTORNEY ASSERTION THAT INFORMATION CONTAINED IN AN IDAHO PUBLIC UTILITIES COMMISSION FILING IS PROTECTED FROM PUBLIC INSPECTION Idaho Power Company’s Annual Compliance Filing to Update the Substation Allowance Under Schedule 19, Large Power Service Case No. IPC-E-24-02 The undersigned attorney, in accordance with Commission Rules of Procedure 67, believes that the attachments in Response to Requests 1, 3, 4 and 5 to Idaho Power Company’s Response to the First Production Request of the Commission Staff to Idaho Power Company, dated February 6, 2024 contain information that Idaho Power Company and a third party claim constitutes confidential trade secrets and/or business records of a private enterprise required by law to be submitted to or inspected by a public agency as described in Idaho Code § 74-101, et seq., and/or § 48-801, et seq. As such, they are protected from public disclosure and exempt from public inspection, examination, or copying. DATED this 7th day of February 2024. Megan Goicoechea Allen Counsel for Idaho Power Company IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 1 MEGAN GOICOECHEA ALLEN (ISB No. 7623) LISA D. NORDSTROM (ISB No. 5733) Idaho Power Company 1221 West Idaho Street (83702) P.O. Box 70 Boise, Idaho 83707 Telephone: (208) 388-2664 Facsimile: (208) 388-6936 mgoicoecheaallen@idahopower.com lnordstrom@idahopower.com Attorneys for Idaho Power Company BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF IDAHO POWER COMPANY’S ANNUAL COMPLIANCE FILING TO UPDATE THE SUBSTATION ALLOWANCE UNDER SCHEDULE 19, LARGE POWER SERVICE ) ) ) ) ) ) ) ) ) CASE NO. IPC-E-24-02 IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF TO IDAHO POWER COMPANY COMES NOW, Idaho Power Company (“Idaho Power” or “Company”), and in response to the First Production Request of the Commission Staff (“Commission” or “Staff”) dated January 17, 2024, herewith submits the following information: IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 2 REQUEST FOR PRODUCTION NO. 1: Please detail the methodology used to calculate overhead expenses that are applied to the project costs for each project. RESPONSE TO REQUEST FOR PRODUCTION NO. 1: Overhead costs are pooled costs that are incurred in support of the Company’s construction process but would be difficult to directly associate to a particular construction job. The Company accumulates the budgeted overheads, groups them by contributing functional area, and divides them by the forecasted construction projects during the same period by work order type to create the overhead rate. The Company has a separate overhead rate for Co- Generation, Stations, Transmission Lines, and Distribution Lines. Please see CONFIDENTIAL Response to Request for Production No. 1 – Attachment 1. The Capital Spend tab contains the actual capital spend between November 2022 and October 2023 used in the calculation. The Overhead Allocation tab contains the actual overhead amounts allocated between November 2022 and October 2023. Formulas dependent upon these supporting tabs are in blue text on the Rates Calculation tab. Formulas dependent only on cells on the Rates Calculation tab remain in black text. The response to this Request is sponsored by Ashley Herrera, Regulatory Analyst, Idaho Power Company. IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 3 REQUEST FOR PRODUCTION NO. 2: Regarding the Confidential Attachment “2024 Sch. 19 Substation Allocation Overhead Rate,” please provide supporting documentation for the following totals: a. B7 - “Subtotal: Customer Overhead Allocated;” b. B8 - “Nov-22 to Oct-23 Actual Overhead Allocated;” c. B12 – “Planning, Engineering & Construction;” d. B13 – “Corporate Projects;” e. B14 – “Power Supply Projects;” f. B16 – “Nov-22 to Oct-23 Actual Overhead Allocated;” and g. B28 – “Admin Overhead.” RESPONSE TO REQUEST FOR PRODUCTION NO. 2: Please see CONFIDENTIAL Response to Request for Production No. 1 – Attachment 1. The response to this Request is sponsored by Ashley Herrera, Regulatory Analyst, Idaho Power Company. IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 4 REQUEST FOR PRODUCTION NO. 3: The primary cost drivers in the proposed substation allowance are the 4-unit metalclad switchgear and the 138kV/13.09kV, 44.8 MVA transformer. Please provide supporting documentation (such as invoices, quotes, etc.), the underlying cost information, and workpapers with formula intact that the Company used to determine the direct and loaded costs for these two items. RESPONSE TO REQUEST FOR PRODUCTION NO. 3: Please see CONFIDENTIAL Response to Request for Production No. 3 – Attachment 1 for workpapers supporting the average loaded cost of the 4-unit metalclad switchgear used in determining the updated substation allowance amount. Purchase Orders supporting the derivation of the 4-unit metalclad’s average cost can be found within CONFIDENTIAL Response to Request for Production No. 3 – Attachment 2. Please see CONFIDENTIAL Response to Request for Production No. 3 – Attachment 3 for workpapers supporting the average loaded cost of the 138kV/13.09kV, 44.8 MVA transformer used in determining the updated substation allowance amount. The Purchase Order supporting the derivation of the 138kV/13.09kV, 44.8 MVA transformer's average cost can be found within CONFIDENTIAL Response to Request for Production No. 3 – Attachment 4. The response to this Request is sponsored by Ashley Herrera, Regulatory Analyst, Idaho Power Company. IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 5 REQUEST FOR PRODUCTION NO. 4: Please provide supporting documentation and workpapers in electronic format for the cost associated with the Company Vehicles and Labor Cost included in the calculation of the Schedule 19 Substation Allowance. RESPONSE TO REQUEST FOR PRODUCTION NO. 4: Please see CONFIDENTIAL Response to Request for Production No. 4 – Attachment 1 – Company Vehicles. Please see CONFIDENTIAL Response to Request for Production No. 4 – Attachment 2 – Labor Cost. The response to this Request is sponsored by Ashley Herrera, Regulatory Analyst, Idaho Power Company. IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 6 REQUEST FOR PRODUCTION NO. 5: Please provide the workpapers with formula intact showing the calculation of the “Loaded Cost” for each of the standard materials used to calculate the allowance as referred to in “Sch. 19 Substation Allowance” workpaper. Please also provide the workpapers (with formula intact) showing the calculation of the loading rate, the inputs used, and sources of information. RESPONSE TO REQUEST FOR PRODUCTION NO. 5: Please see CONFIDENTIAL Response to Request for Production No. 5 – Attachment 1. This attachment provides a summary of how the loadings were applied to each of the materials as filed. As it was compiling its response to discovery, the Company identified a few materials where stores loadings and/or taxes were not appropriately applied. Accordingly, in the above-mentioned attachment, please see the “Schedule 19 Materials as Filed” tab, which walks through the application of the loadings as filed and the “Corrected” tab depicting the correct material loadings. In addition, please see CONFIDENTIAL Response to Request for Production No. 5 – Attachment 2. This attachment includes an “As Filed” tab which reflects the workpaper filed with Case No. IPC-E-24-02 and the “Corrected” tab, which is reflective of the correct material loadings and resulting Schedule 19 Substation Allowance of $71,052. This reflects a $46 impact to the per MVA Substation Allowance. The stores loading rate is evaluated quarterly to determine whether an adjustment is needed to better align the clearing rate with year-to-date stores expenses and issuances while also considering expected forecasted activity. The evaluation is conducted by an internal committee comprised of leaders from the Company’s Supply Chain and Finance Departments (the “Committee”). IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 7 During the August 2023 review, the Committee determined that lower stores loading rates were appropriate primarily due to the expected increase in capital work and continued customer growth. The Company estimates that the reduced stores loading rates will yield a reasonable level of uncleared stores-related expenses by year end, the balance of which would be appropriately associated with unissued inventory. The stations overhead rate calculation is described as part of the Response to Request for Production No. 1. The response to this Request is sponsored by Ashley Herrera, Regulatory Analyst, Idaho Power Company. IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 8 REQUEST FOR PRODUCTION NO. 6: Please explain why the overhead rate used for calculating the Schedule 19 allowance is different from the overhead rate recently filed in IPC-TAE-23-02. RESPONSE TO REQUEST FOR PRODUCTION NO. 6: Please see the Company’s Response to Request for Production No. 1 and the referenced confidential attachment. The response to this Request is sponsored by Ashley Herrera, Regulatory Analyst, Idaho Power Company. IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 9 REQUEST FOR PRODUCTION NO. 7: Please explain the rationale for applying a 4.7% overhead rate on the total loaded materials costs as referred to in “Sch. 19 Substation Allowance” workpaper. RESPONSE TO REQUEST FOR PRODUCTION NO. 7: The “total loaded materials cost” reflected in the “Sch. 19 Substation Allowance” workpaper only includes the applicable stores loading rate and blended sales tax rate, as shown within CONFIDENTIAL Attachment 1 provided in response to Request for Production No. 5. The station’s general overhead rate of 4.7 percent is later applied against the material cost (grossed up for stores and taxes). The Company recognizes that the column header’s title may be confusing and will adjust its naming convention to be clearer as part of subsequent updates. The response to this Request is sponsored by Ashley Herrera, Regulatory Analyst, Idaho Power Company. IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 10 REQUEST FOR PRODUCTION NO. 8: Please explain why the Company is proposing to reduce the overhead rate from 6.57% to 4.7% compared to the previous filing (Tariff Advice No. 22-05). RESPONSE TO REQUEST FOR PRODUCTION NO. 8: Consistent with the methodology approved by the Commission in the first annual update (see Order No. 32982 issued in Case No. IPC-E-14-01) and each subsequent annual update, the stations overhead rate proposed by the Company in this case is based on the charged overhead costs for the last 12 months divided by direct stations capital charges for the last 12 months. The overhead rate decreased primarily due to the increase in direct stations capital charges during the last 12 months. The response to this Request is sponsored by Ashley Herrera, Regulatory Analyst, Idaho Power Company. DATED at Boise, Idaho, this 7th day of February 2024. Megan Goicoechea Allen Attorney for Idaho Power Company IDAHO POWER COMPANY’S RESPONSE TO THE FIRST PRODUCTION REQUEST OF THE COMMISSION STAFF - 11 CERTIFICATE OF SERVICE I HEREBY CERTIFY that on the 7th day of February, 2024, 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 Adam Triplett Deputy Attorney General Idaho Public Utilities Commission 11331 W. Chinden Blvd., Bldg No. 8 Suite 201-A (83714) PO Box 83720 Boise, ID 83720-0074 Hand Delivered U.S. Mail Overnight Mail FAX FTP Site X Email Adam.triplett@puc.idaho.gov Stacy Gust, Regulatory Administrative Assistant BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. IPC-E-24-02 IDAHO POWER COMPANY CONFIDENTIAL REQUEST NO. 1 ATTACHMENT NO. 1 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. IPC-E-24-02 IDAHO POWER COMPANY CONFIDENTIAL REQUEST NO. 3 ATTACHMENT NO. 1 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. IPC-E-24-02 IDAHO POWER COMPANY CONFIDENTIAL REQUEST NO. 3 ATTACHMENT NO. 2 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. IPC-E-24-02 IDAHO POWER COMPANY CONFIDENTIAL REQUEST NO. 3 ATTACHMENT NO. 3 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. IPC-E-24-02 IDAHO POWER COMPANY CONFIDENTIAL REQUEST NO. 3 ATTACHMENT NO. 4 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. IPC-E-24-02 IDAHO POWER COMPANY CONFIDENTIAL REQUEST NO. 4 ATTACHMENT NO. 1 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. IPC-E-24-02 IDAHO POWER COMPANY CONFIDENTIAL REQUEST NO. 4 ATTACHMENT NO. 2 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. IPC-E-24-02 IDAHO POWER COMPANY CONFIDENTIAL REQUEST NO. 5 ATTACHMENT NO. 1 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION CASE NO. IPC-E-24-02 IDAHO POWER COMPANY CONFIDENTIAL REQUEST NO. 5 ATTACHMENT NO. 2