HomeMy WebLinkAbout20070815PAC to Staff 18-23, 25-31, 33-35.pdf~ ~\~ro
~OUNTAIN 201 South Main, Suite 2300
Salt lake City. Utah 84111
August 14 2007 " F1"'.IVEOI ,.-
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Scott Woodbury
Deputy Attorney General
Idaho Public Utilities Commission
472 W Washington
Boise, ID 83702-5983
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Neil Price
Deputy Attorney General
Idaho Public Utilities Commission
472 W Washington
Boise, ID 83702-5983
RE:PAC-07-
IPUC Production Data Request 18-
Please find enclosed Rocky Mountain Power s Response to IPUC Production Requests
18 - 35 excluding 24 and 32. Provided on the enclosed CD are Attachments IPUC
Production 27 -(1-2), 29 and 31. Provided on the enclosed Confidential CD is
Attachment IPUC Production 20 -1. A hard copy of Confidential Attachment IPUC
Production 18 is being provided to IPUC Staff only. The responses to IPUC Production
Requests 24 and 32 are in process and will be provided when available.
If you have any questions, please feel free to call me at (801) 220-4975.
Sincerely,
~~/
f;P
Brian Dickman, Manager
Regulation
Enclosures
" 0
P AC- E-07 -05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 18
IPUC Production Data Request 18
Please provide the full 2006 Long-Term Outlook for Coal and Competing Fuels
Report from Energy Ventures Analysis referenced on page 5 of Company witness
Widmer s testimony.
Response to IPUC Production Data Request 18
Please see Confidential Attachment IPUC Production 18. To avoid unauthorized
copying or dissemination of a copyrighted document, Energy Ventures Analysis
has given the company permission to send a hard copy ofthis publication to IPUC
Staff only under the following conditions: (1) a PDF version should not be made
from the hard copy, (2) the publication should be returned to PacifiCorp once the
review has been completed, and (3) IPUC Staff should conduct their review in
such a manner as to avoid making additional copies and should avoid quoting
verbatim from the document. Please contact Brian Dickman at (801) 220-4975 to
make arrangements to return the publication to the company once the review is
complete.
(Brian T. Durning prepared this response and is the recordholder. Mark T.
Widmer is expected to sponsor this response at hearing. Please contact Brian
Dickman at 801-220-4975 to discuss this response.
IDAHO
P AC-O7-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 18-
CONFIDENTIAL A TT ACHMENT
IPUC PRODUCTION
PROVIDED IN HARD COpy TO STAFF ONLY
PAC-07-05/Rocky Mountain Power
August 14 2007
IPUC Production Data Request 19
IPUC Production Data Request 19
Please provide the Company s Official Price Forecasts used as the market price
inputs for the net power cost calculation. Please explain why two price forecasts
were used?
Response to IPUC Production Data Request 19
Please see the Company s response to Monsanto data request 1.8. The requested
information was provided as Attachment Monsanto 1.8L.
The Company s March 31 , 2007 Official Forward Price Forecast commences
from April 2007. As stated in Mr. Widmer s testimony, the Company
December 31 , 2006 Official Forward Price Forecast was used to provide data for
January 2007, February 2007 and March 2007.
(Mark T. Widmer prepared this response, is the recordholder, and is expected to
sponsor this response at hearing. Please contact Brian Dickman at 801-220-4975
to discuss this response.
PAC-07-05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 20
IPUC Production Data Request 20
Please provide further explanation into the development ofthe market price
hourly scalars. Please include the scalars in the response to this request.
Response to IPUC Production Data Request 20
The development of the hourly scalars is described in Confidential Attachment
IPUC _Production 20 -1. The scalars themselves are extremely confidential, price
and transaction sensitive, and commercially proprietary. Disclosure of this
information may give an undue advantage to competitors and therefore requires
the highest level of confidential treatment. Monthly and hourly scalars developed
for the quarter ended June 30, 2007 will be made available for review at the
company s offices. Please contact Mark Widmer at 503-813-5541 to make
arrangements to review.
(Mark T. Widmer prepared this response, is the recordholder, and is expected to
sponsor this response at hearing. Please contact Brian Dickman at 801-220-4975
to discuss this response.
IDAHO
P AC-07-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 18-
CONFIDENTIAL A TT ACHMENT
IPUC PRODUCTION 20 -
ON THE ENCLOSED CONFIDENTIAL CD
PAC-07-05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 21
IPUC Production Data Request 21
(a) Why does the Company use historical data since 1996 to develop the market
price hourly scalars?
(b) Please recalculate the scalars using historical data from 2002 to December 31
2006 and apply to the Official Price Forecasts used by the Company in this
filing.
Response to IPUC Production Data Request 21
(a) To calculate scalars, the company uses all data available in order to have the
largest possible sample size. The use of a larger sample size improves the
accuracy of the scalars for periods with fewer periods from which to sample
specifically Saturdays and Sundays.
(b) Scalars are updated on a regular basis; the next update is not scheduled to be
available until early October. Due to the time and human resources required
to reprogram code to re-create customer scalars, recalculation of scalars
cannot be completed in time to respond to this data request.
(Mark T. Widmer prepared this response, is the recordholder, and is expected to
sponsor this response at hearing. Please contact Brian Dickman at 801-220-4975
to discuss this response.
PAC-07-05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 22
IPUC Production Data Request 22
On page 21 of Company witness Widmer s testimony, it is stated that the VISTA
model uses the same market price input as the GRID model. Do both models use
the December 31 , 2006 forecast and the March 31 , 2007 forecast, or only the
former?
Response to IPUC Production Data Request 22
The VISTA model used only the December 31 , 2006 forecast.
(Mark T. Widmer prepared this response, is the recordholder, and is expected to
sponsor this response at hearing. Please contact Brian Dickman at 801-220-4975
to discuss this response.
P AC- E-07 -05/Rocky Mountain Power
August 14 2007
IPUC Production Data Request 23
IPUC Production Data Request 23
The GRID model uses normalized retail load by jurisdiction as an input. How is
this information collected, i., at the substation level? Are there any instances in
which the Company has to use its judgment in assigning partial load to multiple
states due to how the load data is collected? Please explain.
Response to IPUC Production Data Request 23
PacifiCorp s jurisdictional loads are calculated by summing control area
generation within a particular state (owned and owned by others) with metered
interchange at the control area boundary and interstate boundary. The company
then subtracts borderline customer load in its control area that is not served by
PacifiCorp. Additionally, the company adds borderline customers (PacifiCorp
load in other control areas) that lie within a specific jurisdiction. Applicable
contractual losses are applied to each jurisdiction on a pro rata load basis (with the
losses for Oregon, Washington, and California spread separately from the losses
for Utah, Idaho, and Wyoming). The load calculation is based on system input
rather that customer usage.
The only partial load assignment to individual states occurs with the contractual
losses allocated to the different states on a pro rata load basis as described above.
The weather impacts on the actual load are then added to or subtracted from the
actual load giving the normalized loads. The weather impacts are estimated using
actual and normal weather for the current year and regression coefficients
estimated using three years of historical information.
(Mark T. Widmer prepared this response, is the recordholder, and is expected to
sponsor this response at hearing. Please contact Brian Dickman at 801-220-4975
to discuss this response.
PAC-07-05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 25
IPUC Production Data Request 25
It is Staff's understanding that the load profile meters used to collect sampling
data for residential Schedules 1 and 36 were installed in 2001 and in 1999 for
irrigation Schedule 10. (a) Have there been additional load profile meters
installed for these classes since then? (b) Have the meters installed in 1999 and
2001 remained at one location, or does the Company rotate meters within the
respective customer class after a period of time? (c) Has the Company done any
studies to determine if its sampling size is adequate? Please explain your
answers.
Response to IPUC Production Data Request 25
(a) To date, no additional load recorders have been installed on the samples
identified, above that which was called for in the sample design.
(b) Load recorders installed at a particular location remain at that location for the
duration of the sample. These sample points will eventually be replaced by an
entirely new sample.
(c) Load samples are designed to meet PURP A mandated requirements of :I:
10% precision at the 90% confidence level. As the data from these samples is
summarized, the sample energy is compared to the measured population energy to
determine if significant variance between sample and population has occurred.
For the samples identified, and for the test year employed by this filing, the total
variance was as follows:
Schedule 01
Schedule 36
Schedule 10
+0.223%
046%
001 %
Looking at just the summer months for the irrigation schedule, the variance is -
623%.
Based on the above information, the company concludes that all samples are still
meeting PURP A requirements. The information also indicates that the company
would be prudent to determine if it is time to replace or adjust the irrigation
sample.
(Douglas Marx prepared this response and is the recordholder. It has not been
determined who will sponsor this response at hearing. Please contact Brian
Dickman at 801-220-4975 to discuss this response.
P AC- E-07 -05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 26
IPUC Production Data Request 26
(a) Please describe the metering equipment in place for residential Schedule 36
customers. (b) What information is collected to facilitate time-of-use billing? (c)
What information is available to the customer; is it available in real-time or only
at billing?
Response to IPUC Production Data Request 26
( a) Rocky Mountain Power installs programmable, solid-state meters that measure
kWh consumption during on-peak and off-peak periods as prescribed in Schedule
36. The energy consumption for the respective periods is stored and displayed as
cumulative totals.
(b) Total energy quantities for on-peak and off-peak are collected via a manual
read on the prescribed meter reading day each month. Current month usage for
on-peak and off-peak is derived by subtracting the previous monthly read from
the current read. There is no further granularity of data available.
(c). On-peak and off-peak energy usage is reported to the customer in their
monthly bill summary. No real-time data or summary is available.
(Douglas Marx prepared this response and is the recordholder. It has not been
determined who will sponsor this response at hearing. Please contact Brian
Dickman at 801-220-4975 to discuss this response.
P AC- E-07 -05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 27
IPUC Production Data Request 27
On page 10 of Company witness Griffith's testimony, it is stated that the on-
peak/off-peak rate differentials for Schedule 36 customers is consistent with the
differential in wholesale cost differences, yet the rate differential is nearly twice
as high in percentage terms as the wholesale differential. Please provide further
support of the prices and differentials proposed by the Company. Also, provide
any analysis the Company has done with respect to the impact Schedule 36 has
had on participating customers' bills, total usage, use pattern, peak load and
Company revenues.
Response to IPUC Production Data Request 27
The on- and off-peak rates in Schedule 36 are not meant to precisely mirror
wholesale prices, but rather to reflect "the direction of wholesale cost
differences " as Mr. Griffith states in his testimony. This means that Schedule 36
rates are lower during off-peak periods than during on-peak periods, and that
customers are provided a clear incentive to shift usage from on-peak to off-peak
periods when possible.
The Company prepared an analysis of Schedule 36 usage compared to Schedule
in September 2006 , using a test period of 12 months ended September 2005. This
study is provided as Attachment IPUC _Production 27 -1. The data and
conclusions contained in this report were previously presented to the Commission
at the PURP A standards conference and the quarterly Commission meeting both
in late 2006. The presentation given at the quarterly Commission meeting in
December 2006 is provided as Attachment IPUC _Production 27 -2. The study
demonstrates that Schedule 36 customers use more energy overall and use a
higher percentage of off-peak energy than Schedule 1 customers. Load research
data used in this analysis indicates that Schedule 36 load often reaches its peak
during off-peak hours, while Schedule 1 peaks during on-peak hours.
Data from the current test period shows that Schedule 36 customers have higher
average bills due to their higher energy use, but pay a lower average cents-per-
kWh rate. This data can be found in Mr. Griffith's Exhibit Nos. 31 and 35.
(William R. Griffith prepared this response, is the recordholder, and is expected to
sponsor this response at hearing. Please contact Brian Dickman at 801-220-4975
to discuss this response.
IDAHO
P AC-07-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 18-
ATTACHMENT IPUC PRODUCTION 27 -(1-
ON THE ENCLOSED CD
P AC- E-07 -05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 28
IPUC Production Data Request 28
(a) Please compare the cost of meter reading for Schedule 1 customers with that
of Schedule 36 customers. (b) Please provide a business case analysis of the
costs/benefits of installing automatic or advanced meter reading capability for
Schedule 36 customers.
Response to IPUC Production Data Request 28
( a). Rocky Mountain Power does not differentiate the cost of meter reading
between Schedule 1 and Schedule 36 customers. The added costs to read a
Schedule 36 customer versus a Schedule 1 customer is marginal.
(b). A comprehensive business analysis of the costs/benefits for automatic or
advanced meter reading systems for Schedule 36 customers has not been
completed. It is impractical to analyze these systems for individual customer
classes.
(Douglas Marx prepared this response and is the recordholder. It has not been
determined who will sponsor this response at hearing. Please contact Brian
Dickman at 801-220-4975 to discuss this response.
PAC-07-05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 29
IPUC Production Data Request 29
Please describe the Company s efforts to promote the Schedule 36 time-of-use
billing to residential customers.
Response to IPUC Production Data Request 29
All new Rocky Mountain Power residential customers in Idaho receive a
Welcome Aboard" booklet that informs them of their two billing options;
Schedule 1 - Standard Service and Schedule 36 - Optional Time-of-Day Service.
Schedule 36 time-of-use billing is also featured on the Company s website under
the "Save Energy and Money" section. Both the webpage and the "Welcome
Aboard" booklet inform the customer of the difference in prices and provide the
timeframes which are considered on and off peak. The "Welcome Aboard"
booklet is provided as Attachment IPUC Production 29. In past years, a bill
insert was sent out to customers each year that informed them of consumer rights/
responsibilities and their pricing options. The bill insert that was sent out last year
in December 2006 did not include pricing information, because of a pending rate
change.
(Douglas Marx prepared this response and is the recordholder. It has not been
determined who will sponsor this response at hearing. Please contact Brian
Dickman at 801-220-4975 to discuss this response.
IDAHO
P AC-07-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 18-
ATTACHMENT IPUC PRODUCTION
ON THE ENCLOSED CD
PAC-07-05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 30
IPUC Production Data Request 30
In the class cost of service models, are residential customers partitioned by
Schedules 1 and 36, or does that occur when the Company does its rate spread and
rate design? Please explain your answer.
Response to IPUC Production Data Request 30
Residential Schedules 1 and 36 are separate in the cost of service study, as are all
individual service schedules. Cost of service results are calculated for the two
schedules separately and can then be aggregated to achieve results for the entire
residential class. Cost of service information is shown separately for Schedules
and 36 in Mr. Tucker s cost of service exhibits 28 - 30.
(Mark Tucker prepared this response, is the recordholder, and is expected to
sponsor this response at hearing. Please contact Brian Dickman at 801-220-4975
to discuss this response.
P AC-07-05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 31
IPUC Production Data Request 31
On page 5, lines 7 through 9 of Company witness Bennion s testimony, it is stated
that "(t)he Company must also build transmission facilities to move power
generated by others (i.e. qualifying facilities) to substations and load centers.
Consistent with Revised Protocol, Section C3 , please provide the following:(a) a list of all QF contracts included in the case;(b) the location of each QF;(c) the embedded cost differential calculation for each existing QF under the
Revised Protocol;
the Comparable Resource calculation for each new QF;
the dollar amount allocated as a system cost for each project, and
the dollar amount allocated as a situs cost for each project.
(d)
(e)
(f)
Response to IPUC Production Data Request 31
(a)
(b)
(c)
The requested information is provided as Attachment IPUC Production
31.
See the company s response to (a) above.
Consistent with Revised Protocol, Section C3 the existing QF contract
differential is not calculated on an individual contract by contract basis.
The Existing QF Contract costs in each State are compared against
normalized costs of the remaining generation portfolio on a $/MWh basis
and an adjustment which reflects the cost difference is applied. This
adjustment is referred to as "Existing QF Contracts Cost Differential
Adjustment." The Existing QF Contracts Cost Differential Adjustment is
calculated as the Annual Existing QF Contracts Costs for a specific State
less the Annual Embedded Costs - All Other, multiplied by the
normalized MWh's of output from that State s Existing QF Contracts. See
Steven R. McDougal direct testimony exhibit 11 page 10.23 for the
calculation of the existing QF contract differential.
(d)The intent of the comparable resources standard in the Revised Protocol is
to provide a remedy when a state commission directs the Company to
enter into a qualifying facility contract with pricing terms beyond the state
approved avoided costs. The pricing terms of all qualifying facility
contracts entered into since the effective date of the Revised Protocol have
fallen within the parameters of avoided costs. It is the expectation of the
Company that the pricing provision of all new qualifying contracts will
fall in the parameters of approved avoided costs and that the provision for
situs assignment of cost beyond those of a comparable resource will not
come into play.
P AC-07-05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 31
(e)The QF projects listed below are not included in the existing QF contract
differential calculation and these are system allocated.
Douglas County Forest Products
R. Johnson
Evergreen BioPower
ExxonMobil
Kennecott
Pioneer Ridge
Simplot Phosphates
Tesoro
US Magnesium
Weyerhaeuser
The remaining QF projects are part of the existing QF contract differential.
The costs of Existing QF Contracts are first allocated on a system-wide
basis. Then the Existing QF cost difference is calculated separately for
each State. This adjustment is situs assigned to that State. The sum of this
adjustment for all States is calculated and an adjustment for the reciprocal
amounts is allocated to all States using the SG factor. This adjustment
assigns $604 429 of situs expense to Idaho and reduces SG system
allocated expense to Idaho by $2 746 762.
The dollar amounts for these QF projects are included as Attachment
IPUC Prodcution 31.
(1)There are no individual QF projects that are assigned situs.
(Mark Widmer prepared the responses to parts a, b, and d of this request, is the
recordholder for these parts, and is expected to sponsor the above-mentioned
responses at hearing. Steven R. McDougal prepared the responses to parts c, e
and f of this request, is the recordholder for these parts, and is expected to sponsor
the above-mentioned responses at hearing. Please contact Brian Dickman at 801-
220-4975 to discuss this response.
IDAHO
P AC-07-
ROCKY MOUNTAIN POWER
IPUC PRODUCTION DATA REQUESTS 18-
ATTACHMENT IPUC PRODUCTION
ON THE ENCLOSED CD
P AC- E-07 -05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 33
IPUC Production Data Request 33
Please describe in greater detail the gas procurement strategies for the Currant
Creek and Lakeside projects. Has the Company negotiated a contract to supply
the Lakeside project with natural gas, and if so, please provide it with your
response. Also, if the plant is not online when anticipated, please provide the
Company s plan for marketing/utilizing otherwise unused natural gas?
Response to IPUC Production Data Request 33
There are no specific natural gas supply contracts dedicated solely to Lake Side
requirements. Lake Side and Currant Creek requirements are part of a portfolio of
risks and requirements for which hedging and procurement on a forward basis are
done in aggregate. PacifiCorp currently has the monthly natural gas price risk
associated with its natural gas fired generation assets, including Currant Creek
and Lake Side, fully or partially hedged through 2011. PacifiCorp procures
physical natural gas by employing a strategy that balances the security of higher
cost long-term firm contractual commitments with the expected availability of
lower cost short term firm purchases. These long-term firm commitments extend
through 2011 and the short-term firm purchases are done on a season ahead or
month ahead basis.
PacifiCorp continually manages its expectations of fuel requirements at Lake Side
and transacts natural gas in the day-ahead and forward markets in order to
efficiently and economically manage the price and delivery risk associated with
the uncertain requirements during the testing and commissioning of the plant.
expectations and the reality of requirements change, excess natural gas diverted to
other generating plants or sold to third parties, whichever is more economic.
(Bruce Evans prepared this response and is the recordholder. Mark T. Widmer is
expected to sponsor this response at hearing. Please contact Brian Dickman at
801-220-4975 to discuss this response.
P AC- E-07 -05/Rocky Mountain Power
August 14 2007
IPUC Production Data Request 34
IPUC Production Data Request 34
(a) Please describe how the Renewable Energy Tax credit for wind generation
additions was calculated in Company witness McDougal's Exhibit No. 13. (b) Is
the Blundell bottoming cycle project eligible for the Renewable Energy Tax
credit, and if so, how has the Company incorporated it into this rate filing?
Response to IPUC Production Data Request 34
(a) The Renewable Energy Tax credit for the wind generation additions was
calculated using the 2 cents multiplied by the kilowatt hours of electricity
production by plant as shown in the power cost study in Mark Widmer s Exhibit
No. 14 pg. 10 of 15 for the Other Generation.
(b) Yes, the Blundell Bottoming Cycle project is eligible for the Renewable
Energy Tax Credit. This credit was inadvertently excluded from the company
case, and would properly be included as a reduction to FERC Account 409. The
Renewable Energy Tax credit is calculated the same as for the wind generation.
The test year in the company s case includes 15 620 598 kWh from the Blundell
Bottoming Cycle. The Federal Renewable Energy credit (2 cents per kWh)
would equal of$312 412; allocated on an SE factor (6.5817%) to Idaho would
produce a federal credit of $20 562. The Bottoming Cycle project would also
qualify for a Utah State Renewable Energy credit of .35 cents per kWh, or
$54 672, as a reduction to the calculation of the Utah state income tax expense.
The IBT factor would be used to allocate this state credit to Idaho for an amount
of $1 ,205 ($54 672 multiplied by .022044), resulting in a net credit to Idaho total
current tax expense of$783.
(L. Susan Morton and Steven R. McDougal prepared this response, are the
recordholders, and are expected to sponsor this response at hearing. Please
contact Brian Dickman at 801-220-4975 to discuss this response.
PAC-07-05/Rocky Mountain Power
August 14, 2007
IPUC Production Data Request 35
IPUC Production Data Request 35
Please provide an explanation and any supporting materials, including any
contract information regarding the Company s share ofthe Jim Bridger mine that
would support and quantify the projected increase in costs for 2007.
Response to IPUC Production Data Request 35
The Jim Bridger plant is supplied by both Bridger Coal Company and Black Butte
Coal Company. The 2007 calendar year Idaho filing reflects a slight decrease in
Bridger Coal Company operating cost from $1.180/mmBtu in calendar year 2006
to $1. 177/mmBtu in calendar year 2007. This decrease is offset by an increase in
the Tier 1 contract price from Black Butte Coal Company from $0.989/mmBtu in
calendar year 2006 to $1.005/mmBtu in calendar year 2007. The Tier 1 price is
escalated based on changes in a basket of producer price indices such as labor and
benefits, materials and supplies, steel, explosives, diesel fuel, and petroleum
products. In addition, the transportation rate increased due to rising fuel costs
reflected in the rail fuel surcharge. The net result is an overall price increase of
$0.003/mmBtu from calendar year 2006 to calendar year 2007. PacifiCorp
share ofthe Jim Bridger plant is 66.7%.
The following table summarizes the changes in fuel cost from calendar year 2006
to calendar year 2007.
Calendar Year 2006 Calendar Year 2007
Idaho Filing 2/8/2006 Idaho Filing 3/8/2007 Increase/Decrease
(thousands)thousands (thousands)
Bridger Mine
Tons 014.3 004.
MMBtu 660.4 825.164.
$/MMBtu $1.180 $1.177 ($0.003)
Black Butte Mine
Tons 725.4 737.12.
MMBtu 875.016.141.0
$/MMBtu $0.989 $1.005 $0.016
Total
Tons 739.742.
MMBtu 107 536.107 842.1 305.
$ /MMB tu $1.122 $1.125 $0.003
(Brian T. Durning prepared this response and is the recordholder. Mark T.
Widmer is expected to sponsor this response at hearing. Please contact Brian
Dickman at 801-220-4975 to discuss this response.