20070724PAC to Staff 1-2, 4-6, 9-10, 12-13, 15-17.pdf

~~t~OUNT
AIN 20 I South Main. Suite 2300
Salt lake City. Utah 84111
, i ..
July 23 , 2007
.. .
Scott Woodbury
Deputy Attorney General
Idaho Public Utilities Commission
472 W Washington
Boise, ID 83702-5983
Neil Price
Deputy Attorney General
Idaho Public Utilities Commission
472 W Washington
Boise, ID 83702-5983
RE:PAC-07-
IPUC Production Data Request 1-
Please find enclosed Rocky Mountain Power s Response to IPUC Production Requests 1
, 10, 12, 13 , 15 ,16 and 17. Responses to IPUC Production Requests 3 , 7, 8
11 and 14 are currently being prepared and will be provided once they are available.
Provided on the enclosed CD are Attachments IPUC Production 1 , 2 -(1-2), 16 and 17 -
(1-4). Provided on the enclosed Confidential CD are Attachments IPUC Production 4
and 9.
If you have any questions, please feel free to call me at [phone].
Sincerely,
~a;l\ckJ&~ I~.
Brian Dickman, Manager
Regulation
Enclosures
P AC- E-07 -05/Rocky Mountain Power
July 23, 2007
IPUC Production Data Request
IPUC Production Data Request 1
Please provide a copy of the Navigant report referred to on pages 4-5 of the direct
testimony of William Fehrman. The Navigant report was an assessment of the
evaluation process for RFP 2003-A in which the Lake Side project was chosen as
the best alternative.
Response to IPUC Production Data Request 1
The above referenced Navigant report is provided as Attachment
IPUC Production 1 on the enclosed CD.
(William J. Fehrman is expected to sponsor this response at hearing.
IDAHO
PAC-O7-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 1-
ATTACHMENT IPUC PRODUCTION
ON THE ENCLOSED CD
P AC- E-07 -05/Rocky Mountain Power
July 23, 2007
IPUC Production Data Request 2
IPUC Production Data Request 2
Please provide a copy ofRFP 2003-B issued in February 2004. Please identify or
provide a list of amendments to RFP 2003-B following the acquisition of
PacifiCorp by MidAmerican Energy Holdings Company.
Response to IPUC Production Data Request 2
RFP 2003-, issued in February 2004, is provided as Attachment IPUC 2 -Ion
the enclosed CD. The RFP 2003-B amendment following the acquisition of
PacifiCorp by MidAmerican Energy Holdings Company is provided as
Attachment IPUC 2 -2 on the enclosed CD.
(William J. Fehrma,n is expected to sponsor this response at hearing.
IDAHO
P AC-O7-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 1-
ATTACHMENT IPUC PRODUCTION 2 -(1-
ON THE ENCLOSED CD
P AC- E-07 -05/Rocky Mountain Power
July 23 , 2007
IPUC Production Data Request 4
IPUC Production Data Request 4
Please provide a summary of all bids received in response to RFP 2003-
Response to IPUC Production Data Request 4
A confidential summary of all bids received in response to RFP 2003-B is
provided as Confidential Attachment IPUC Production 4. This document
contains confidential information and is provided subject to the terms and
conditions of the protective order in this proceeding.
(William 1. Fehrman is expected to sponsor this response at hearing.
IDAHO
P AC-O7-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 1-
CONFIDENTIAL ATTACHMENT
IPUC PRODUCTION 4
ON THE ENCLOSED CONFIDENTIAL CD
PAC-07-05/Rocky Mountain Power
July 23, 2007
IPUC Production Data Request 5
IPUC Production Data Request 5
Please provide a summary of all projects short-listed in the evaluation process for
RFP 2003-
Response to IPUC Production Data Request 5
Please refer to IPUC Production Data Request 4.
(William J. Fehrman is expected to sponsor this response at hearing.
P AC- E-07 -05/Rocky Mountain Power
July 23 , 2007
IPUC Production Data Request 6
IPUC Production Data Request 6
For each short-listed bid not selected in RFP 2003-, please provide an
explanation and supporting documentation of why the bid was not selected.
Response to IPUC Production Data Request 6
Please refer to page 2 and page 3 of the document provided in response to IPUC
Production Data Request 4.
With respect to Phase 1 ofRFP 2003-, as of April 2005 , a project would have
needed to reach commercial operation by December 31 , 2005 to retain the benefit
of the Federal production tax credit. Two bids proposed a commercial operation
date during 2005 (bid 67-170 and 82-550). Bid 67-170 was rejected due to a
negative net present value revenue requirement. Bid 82-550 was the bid that
resulted in the Wolverine Creek power purchase agreement.
With respect to Phase 2 ofRFP 2003-, bids short-listed and not selected were
bids; 83-630b, 82-580cd (59.8 MW), 69-290, 72-430a, and bids 90-730a(1). Bids
83-630b, 69-290, and 72-430a were not selected due to a negative net present
value revenue requirement. Bids 83-610b and 82-580cd (120.5 MW) were the
bids that resulted in the Leaning Juniper 1 and Marengo projects respectively. Bid
82-580cd (59.8 MW) was not selected since the bid relied on the same project site
as bid 82-580cd (120.6 MW). Bids 90-730a(1) were not selected due to delivery
uncertainty associated with anticipated and necessary transmission upgrades on
the Idaho Power transmission system.
(William 1. Fehrman is expected to sponsor this response at hearing.
P AC-07-05/Rocky Mountain Power
July 23, 2007
IPUC Production Data Request 9
IPUC Production Data Request 9
In discussing the Leaning Juniper, Marengo, and Goodnoe Hills projects, the
direct testimony of William Fehrman states "The Company was provided with a
detailed overview of the project, the contract support and counterparty guarantees
for executing upon the project, a comparison against the risks associated with an
alternative bidder, the risks associated with the project, the need for the project as
established by the IRP, the financial assessment of the project and the justification
ofthe project due to the results ofRFP 2003-A." To the extent not provided in
response to Request No., please provide the information referred to in the
quoted testimony for each ofthese three projects.
Response to IPUC Production Data Request 9
Please refer to Confidential Attachment IPUC Production 9 on the enclosed CD.
It consists of the following files: (Leaning Juniper).pdf, (Marengo).pdf, and
(Goodnoe Hills).pdf. These documents contain confidential information and are
provided subject to the terms and conditions of the protective order in this
proceeding.
(William J. Fehrman is expected to sponsor this response at hearing.
IDAHO
PAC-O7-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 1-
CO NFID E NTIAL A TT A CHME NT
IPUC PRODUCTION 9
ON THE ENCLOSED CONFIDENTIAL CD
PAC-07-05/Rocky Mountain Power
July 23 , 2007
IPUC Production Data Request 10
IPUC Production Data Request 10
On page 11 , lines 7-10 of William Fehrman s direct testimony, he states
, "
RFP
20O3-B resulted in the acquisition of the 100.5 megawatt Leaning Juniper wind
plant, the acquisition and subsequent construction of the 140.4 megawatt Marengo
wind plant, and served as a benchmark to compare other wind resource
alternatives against (such as the Goodnoe Hills wind project)." Please explain in
more detail what is meant by " .
. .
served as a benchmark to compare other wind
resource alternatives against." Was the Goodnoe Hills project not bid in RFP
20O3-B? If not, how was the proposal received? Have other wind proposals been
received outside ofthe RFP 20O3-B process?
Response to IPUC Production Data Request 10
The phrase
" . . .
served as a benchmark to compare other wind resource alternatives
against.. ." means that the knowledge obtained from RFP 2003 - B informed
PacifiCorp s assessment of other wind resource alternatives.
PacifiCorp received the Goodnoe Hills project proposal from the project
developers and not via RFP 20O3-B. PacifiCorp has received information
regarding wind projects other than via RFP 20O3-
(William 1. Fehrman is expected to sponsor this response at hearing.
PAC-07-05/Rocky Mountain Power
July 23 , 2007
IPUC Production Data Request 12
IPUC Production Data Request 12
Please identify the amount of federal production tax credits or equivalent
deductions on an annual basis PacifiCorp expects to receive for the renewable
projects (Leaning Juniper, Marengo, Goodnoe Hills, Blundell). Please also
identify any state tax credits or other state incentives that have been received or
will be received for these projects and discuss how these credits or incentives will
be jurisdictionally allocated. Please indicate where in the Results of Operations
these credits are accounted for.
Response to IPUC Production Data Request 12
The anticipated amount of federal production tax credit for Leaning Juniper
Marengo, Goodnoe Hills, and Blundell is approximately $5 923 000; $3,407 000;
$546 000; and $0 respectively. Blundell does not qualify for the renewable energy
credits since it was placed in service prior to October 22, 2004, which is the date
after which qualified plants have to be placed in service. These credits are based
on the applicable production included in the net power cost study in the
company s general rate case. The current federal production tax credit rate is 2
cents per kilowatt hour. The total credit is dependent upon the annual amount of
production at each plant, and the annual credit amount will change as the energy
output at each plant changes.
These federal production tax credits are included in the Results of Operations as
Adjustment 7., which treats these credits as a reduction to FERC account 409.10.
Since these are related to production of energy, the allocation factor used to
allocate them is the SE (System Energy) factor.
The Leaning Juniper plant also qualifies for an Oregon BETC (Business Energy
Tax Credit) of$1 million for the twelve-month period ending December 2007.
This amount was inadvertently excluded from the case. Because state income tax
items are system-allocated using the IBT (Income Before Taxes) factor, Idaho rate
payers would be entitled to an allocated share of this credit. The Idaho IB T factor
in the current case is .022044. Applying that percentage to the $1 million credit
produces a decrease in the amount of state income tax expense allocated to Idaho
of approximately $22 044. When that reduction is netted with a $7 716 increase
in current federal tax due to this state tax reduction, the net result from this state
tax credit is a reduction to total current tax expense of approximately $14 328 for
Idaho.
(Steven R. McDougal is expected to sponsor this response at hearing.
PAC-07-05/Rocky Mountain Power
July 23, 2007
IPUC Production Data Request 13
IPUC Production Data Request 13
Please list any funds received by PacifiCorp from the BP A Conservation and
Renewable Resource Credit Program and from the Energy Trust of Oregon that
are being used for any ofPacifiCorp s renewable generation projects. Please state
the amounts received from each program and the corresponding projects to which
they have been or will be applied.
Response to IPUC Production Data Request 13
From January - September 2006, PacifiCorp received $1 555 909 from the
Bonneville Power Administration (BP A) Conservation and Renewable Discount
(C&RD) Program. These funds were received due to energy produced by the
Rock River 1 wind project.
From October - December 2006, PacifiCorp received $643 128 from BPA'
Conservation Rate Credit (CRC) Program (successor to the C&RD program). A
portion of these funds will be applied to conservation efforts with the remaining
amount applied to renewable resource projects.
In 2007, PacifiCorp anticipates receiving $2 572 411 from the BPA CRC
Program, subject to the final outcome oftheNinth Circuit Court ruling on BP A
payments and $0 from the Energy Trust of Oregon Inc.
Funds received from the Energy Trust of Oregon Inc. in the future will be utilized
to reduce expenses associated with the Goodnoe Hills project. Funds received
from the BP A CRC Program do not become project-specific until PacifiCorp
provides BP A with a final accounting pursuant to the provisions of the program.
(Steven R. McDougal is expected to sponsor this response at hearing.
P AC- E-07 -05/Rocky Mountain Power
July 23, 2007
IPUC Production Data Request 15
IPUC Production Data Request 15
Please compare the costs of the Leaning Juniper, Marengo and Goodnoe Hills
projects to the cost assumption for wind generation included in PacifiCorp s 2003
and 2007 IRPs. If the costs of any of these projects exceed the wind generation
costs assumed in either the 2003 or 2007 IRPs, please provide justification for
why the Company still decided to acquire the resources and discuss whether there
is any cost limit that the Company would not be willing to exceed in order to meet
its renewable resource targets.
Response to IPUC Production Data Request 15
The capital cost to acquire the Leaning Juniper, Marengo, and Goodnoe Hills
projects are higher than the capital cost assumptions in PacifiCorp s 2003 and
2007 Integrated Resource Plans.
Please refer to IPUC Production Data Request 9 for the Company s justification
for acquiring the Leaning Juniper, Marengo, and Goodnoe Hills projects.
With respect to cost limits, the Company makes individual resource decisions on
a case by case basis and based on what the Company knows at the time.
(William J. Fehrman is expected to sponsor this response at hearing.
P AC- E-07 -05/Rocky Mountain Power
July 23 , 2007
IPUC Production Data Request 16
IPUC Production Data Request 16
The testimony of Carole Rockney discusses a proposed change to the
methodology used for line extension refunds. In her testimony on page 10, lines
13-, she states
, "
Transferring the contract is an administrative burden that is
time consuming and is not a requirement in any other state served by the
Company." How many contracts were transferred in Idaho in each of the past two
years? Please provide an estimate of the time and expense of transferring a
contract, or otherwise provide some evidence of the administrative burden.
Response to IPUC Production Data Request 16
Below is the number of residential contracts that have been transferred:
From 7/1105 through 6/30/06 -- 5 transfers
From 711/06 through 6/30/07
--
9 transfers
Attachment IPUC Production 16 gives a comparison between the existing and
proposed processes. The existing process generally takes two or more hours per
transfer. The activity rate for Idaho estimators is $89.47 per hour. Based on an
average of approximately 2 hours, the estimated cost is $179 to transfer the
contract as applies to Idaho residential refunds.
(Carole A. Rockney is expected to sponsor this response at hearing.
IDAHO
P AC-O7-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 1-
ATTACHMENT IPUC PRODUCTION
ON THE ENCLOSED CD
PAC-07-05/Rocky Mountain Power
July 23 , 2007
IPUC Production Data Request 17
IPUC Production Data Request 17
Please explain the method used to temperature normalize residential and small
commercial revenues as per Adjustment 3.1 (McDougal, Exhibit 11). Please
provide the model and input data used to determine temperature normalized
revenues.
Response to IPUC Production Data Request 17
See Attachments IPUC Production 17 -1 through 17 -4 on the enclosed CD.
(It has not been determined who will sponsor this response at hearing.
IDAHO
P AC-O7-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 1-
ATTACHMENT IPUC PRODUCTION 17 -(1-
ON THE ENCLOSED CD