20101119PAC to Monsanto 16 (1-15).pdf

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November 18,2010
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201 South Main, Suite 2300
Salt Lake City, Utah 84111
Randall C. Budge
RACIN, OLSON, NYE, BUDGE &
BAILEY, CHATERED
P.O. Box 1391; 201 E. Center
Pocatello, Idaho 83204-1391
RE: ID PAC-E-1O-07
Monsanto 16th Set Data Request (1-15)
Please find enclosed Rocky Mountain Power's responses to Monsanto 16th Set Data Requests
16.1-16.15. Provided on the enclosed CD is Attchment Monsanto 16.1 1.
If you have any questions, please feel free to call me at [phone].
Sincerely,
31 "Pc( /V~~/ ~
J. Ted Weston
Manager, Regulation
Enclosure:
cc: Jean JewelllPUC (C)/ 3 copies
Eric Olsen/IPA(C)
Ben Otto/ICL (C)
James R. Smithonsanto (C)
Richard AndersonIonsanto (C)
George C. Carer, III/Monsanto (C)
Denns PeseauIonsanto (C)
Gareth R. Kajander/Monsanto (C)
Maurice Brubaker/Monsanto (C)
Brian Collns/Monsanto (C)
Michael Gormanonsanto (C)
Kathr Iverson/onsanto (C)
Mark Widmer/Monsanto (C)
P AC-E-1 0-07/Rocky Mountan Power
November 18,2010
Monsanto Data Request 16.1
Monsanto Data Request 16.1
Please provide Mr. Clements' understading as to how long Monsanto has been
an interrptible customer on the PacifiCorp (and its predecessors) system.
Response to Monsanto Data Request 16.1
It is Mr. Clements' understading that Monsanto has been a customer with some
tye of interrptible terms and conditions in its contract since 1951.
Recordholder:
Sponsor:
Paul Clements
Paul Clements
P AC-E-1 0-07/Rocky Mountain Power
November 18, 2010
Monsanto Data Request 16.2
Monsanto Data Request 16.2
What is Mr. Clements' understanding of the defition of firm load as applied in
PacifiCorp's integrated resource planng?
Response to.Monsanto Data Request 16.2
Firm load is load that the Company has an obligation to serve.
Recordholder:
Sponsor:
Paul Clements
Paul Clements
PAC-E-10-07/Rocky Mountain Power
November 18,2010
Monsanto Data Request 16.3
Monsanto Data Request 16.3
How much of Monsanto's load does Mr. Clements consider as firm?
Response to Monsanto Data Request 16.3
Monsanto's entire load is treated as firm load and their interrptible products are
treated as firm resources. Please see the Rebuttal Testimony of Gregory N.
Duvall in Case No. PAC-E-1O-07 for a detailed explanation of the treatment of
Monsanto load in the integrated resource plan.
Recordholder:
Sponsor:
Paul Clements
Paul Clements
P AC-E-1 0-07/Rocky Mountain Power
November 18, 2010
Monsanto Data Request 16.4
Monsanto Data Request 16.4
Has PacifiCorp (and its predecessors) ever included 100% of Monsanto's load as
firm for the puroses of the Company's integrated resource plang? Please
explain and cite all such instances. For each instance, provide the amount of load
considered as firm.
Response to Monsanto Data Request 16.4
Please see the Rebuttal Testimony of Gregory N. Duvall in Case No. PAC-E-10-
07 for a detailed explanation of the treatment of Monsanto load in the integrated
resource plan.
Recordholder:
Sponsor:
Paul Clements
Gregory Duvall
PAC-E-10-07/Rocky Mountain Power
November 18,2010
Monsanto Data Request 16.5
Monsanto Data Request 16.5
At page 6, lines 4-5, Mr. Clements states that Monsanto has always executed
shorter term agreements with PacifiCorp, historically five years or less, for its
interrptible products. Please provide the following information:
a. Please identify each agreement of five years or less Mr. Clements
is referring to in support of this statement.
b. Has Monsanto ever requested a contract term longer than five
years from PacifiCorp? If yes, please explain and cite all such
instances.
c. Has PacifiCorp ever been willing to enter into a contrct term
longer than five years with Monsanto? If yes, please explain and
cite all such instances. If no, please explain why PacifiCorp was
not willing to enter into a contract term longer than five years with
Monsanto. Please include the names of the individuas at
PacifiCorp responsible for this decision.
Response to Monsanto Data Request 16.5
a. Special contracts were entered into in 1991, 1995,2000,2003,2007 and 2008.
b. Mr. Clements has been involved in Monsanto negotiations since 2004. Since his
involvement, he is unware of instaces where the paries discuSsed a contract
term of longer than five years.
c. PacifiCorp has been willing to enter into contrcts of longer than five years as
long as those contracts included mechansms that allowed the Company to
recover its prudent costs incured to provide service to Monsanto thoughout the
entire term of such contracts. The decision on contract term is made by the
PacifiCorp Energy President and Rocky Mountain Power President.
Recordho1der:
Sponsor:
Paul Clements
Paul Clements
PAC-E-I0-07/Rocky Mountain Power
November 18, 2010
Monsanto Data Request 16.6
Monsanto Data Request 16.6
Does either the Front Office model or GRID model attbute any value for
capacity in the calculation of Monsanto's interrptibilty value? Please explain.
Response to Monsanto Data Request 16.6
The Front Office and GRID models calculate the cost of replacing the
interrptible products Monsanto provides with products provided from other
sources, namely existing Company resources or market purchases. The models
are not configued to arbitrarly assign a specific capacity value based on a new
resource.
Recordholder:
Sponsor:
Paul Clements
Paul Clements
P AC-E-l 0-07/Rocky Mountai Power
November 18, 2010
Monsanto Data Request 16.7
Monsanto Data Request 16.7
Has Mr. Clements recognized any capacity value in the calculation of Monsanto' s
interrptibilty value? Please explain.
Response to Monsanto Data Request 16.7
Please refer to the Company's response to Monsanto Data Request 16.6.
Recordholder:
Sponsor:
Paul Clements
Paul Clements
PAC-E-I0-07/Rocky Mountain Power
November 18, 2010
Monsanto Data Request 16.8
Monsanto Data Request 16.8
Has the Commission ever issued an order approving a valuation of Monsanto's
interrptibilty based on either the Front Offce model or the GRID model?
Response to Monsanto Data Request 16.8
The November 5, 2007 Electric Service Agreement between PacifiCorp and
Monsanto was approved by the Idaho Public Utilities Commssion in Order No.
30482. Whle ths was a black box settlement the Company supported the
settlement amount based on the valuation of Monsanto's curlment product
utilizing the Front Offce and GRID models.
Recordholder:
Sponsor:
Ted Weston
Paul Clements
P AC-E-1 0-07/Rocky Mountain Power
November 18,2010
Monsanto Data Request 16.9
Monsanto Data Request 16.9
Please identify all non-firm loads on the PacifiCorp system that have been valued
by the Company in any report or filing with any state Commission using a method
that recognizes the capacity value of the non-firm load. Please cite each instance
and provide a description of the method used by the Company in performing the
valuation. Please identify the capacity value in $/kW-year used in valuing the
non- firm load.
Response to Monsanto Data Request 16.9
The Company objects to ths data request on the basis that the question is vague,
overly broad and irrelevant to the valuation of Monsanto's interrptible products.
Without waiving this objection, PacifiCorp states as follows.
All load on PacifiCorp's system is firm load. PacifiCorp has arangements with a
handful of large industral customers (Monsanto, Nucor, and MagCorp) to provide
load curlments under specific conditions. If these arangements went away, the
Company would be.required to serve their load just like any other customer on the
system. The methods used to evaluate interrptible contracts are consistent with
those described in response to Monsanto Request 16.6.
Please note the terms and conditions are different among curlment products so
the evaluation for anyone product is not applicable to Monsanto.
Recordholder:
Sponsor:
Gregory Duvall / Rick Link
Paul Clements
PAC-E-I0-07/Rocky Mountain Power
November 18,2010
Monsanto Data Request 16.10
Monsanto Data Request 16.10
Please identify all demand-side management (DSM) loads on the PacifiCorp
system that have been valued by the Company in any report or filing with any
state Commission using a method that recognzes the capacity value of the DSM
load. Please cite each instace and provide a description of the method used by
the Company in performing the valuation. Please identify the capacity value in
$/kW-year used in valuing the DSM load.
Monsanto Data Request 16.10
The Company objects to ths data request on the basis that the question is vague,
overly broad and irrelevant to the valuation of Monsanto's interrptible products.
Without waiving ths objection, PacifiCorp states as follows.
All load on PacifiCorp's system is firm load. PacifiCorp has argements with
some Utah irrigation customers and residential ai-conditionig customers in Uta
to provide load curlments under specific conditions. If these arangements went
away, the Company would be required to serve their load just like any other
customer on the system.
Copies of reports for irrgation and the residential air-conditioning progr can
be found on the PacifiCorp website at ww.pacificorp.com. then "Energy
Sources," "Demand-Side Management," then "Reports and Program Evaluations
by Jursdiction."
Regarding the methodology for valuing demand response programs, PacifiCorp
curently uses its capacity expansion optimization model, called System
Optimizer, to determine the system avoided cost for a given program size in
megawatts. This methodology is applied for irrgation dispatchable load control
and the Uta air conditioning program (Cool Keeper). For ths methodology, a
base resource portfolio is developed using the latest integrated resource plan
preferred portfolio. The next significant thermal resource-a combined-cycle
combustion tubine-is replaced with sufcient simple-cycle combustion tubine
capacity (SCCT) to more than offset the size of the demand response program.
Next, the demand response program is added as a portfolio option to the model at
zero cost, and the model is then allowed to re-optimize the base portfolio. The
cost difference between the two portfolios is converted into a net present value
using a capital recovery factor, and divided by the demand response program
megawatts to yield the avoided cost in dollars per kilowatt-year ($/kW-yr). This
methodology captues SCCT capacity and firm market purchase deferral value,
re-dispatch of existing resources, and changes in the amount of system balancing
(spot market) energy sold and purchased at markets defined for the modeL. The
latest program avoided cost values are cited in the reports cited above.
PAC-E-I0-07/Rocky Mountain Power
November 18,2010
Monsanto Data Request 16.10
Please note the terms and conditions are different among curailment products so
the evaluation for anyone product is not applicable to Monsanto.
Recordholder:
Sponsor:
Paul Clements
Paul Clements
P AC- E-l 0-07/Rocky Mountain Power
November 18,2010
Monsanto Data Request 16.11
Monsanto Data Request 16.11
At page 20, lines 9-11, Mr. Clements states that a combustion turbine is available
to customers for their benefit 8,410 hours per year assumng a 96% availabilty
factor.
a. Is it Mr. Clements' position that in order for a combustion tubine
to be available for 8,410 hours per year, natual gas would have to
be nominated for the tubine for each of those 8,410 hours per
year? Please explain.
b. Is it Mr. Clements' position that PacifiCorp nominates natual gas
for each of its combustion tubines for each hour of the year?
Please explain.
c. Does PacifiCorp nominate natual gas for each combustion tubine
for each hour of a year? Please explain.
d. Please provide the capacity factor assumed for each of the
Company's combustion tubines modeled in GRID for the test
year.
e. Please provide the actu capacity factor for each of the
Company's combustion tubines for the years 2007-2009.
f. For each of the Company's combustion tubines please provide the
anual number of hours the combustion tubine served load on the
system for the years 2007-2009.
g. For each of the Company's combustion tubines please provide the
actual anual number of hours for which the Company nominated
natural gas for each unt for the years 2007-2009.
Response to Monsanto Data Request 16.11
a. No. Natual gas is not nomiated on an hourly basis. Natual gas is tyically
nominated on a day-ahead basis with the ability to modify nomintions intraday
until 16:00 Mountain time.
b. No. PacifiCorp has the abilty to nomiate natual gas with the intent to ru any
combustion tubine for any hour of a year. PacifiCorp does not nominate gas on
an hourly basis. Natural gas is typically nominated on a day-ahead basis.
PacifiCorp also has the ability to modify nominations intraday until 16:00 PST.
c. Please see the Company's response to 16.11 b above.
d. The combustion tubine capacity factors in the test period are as dispatched by
GRID, based on assumptions for the test period, including the availabilty of those
resources, Company's load obligation, availabilty of the rest of the Company's
resource portfolio, and market prices for the test period. Capacity factors and
availabilty of the unts can be obtaed from the GRI database provided in
response to Monsanto Request 2.1.
P AC-E-1 0-07/Rocky Mountan Power
November 18,2010
Monsanto Data Request 16.11
e. Please refer to Attachment Monsanto 16.11.
f. Please refer to Attachment Monsanto 16.11.
g. Please see the Company's response to 16.11 a, band c above for detals on
procedures for natual gas nominations. See 16.11 f above for the number of
hours each combustion tubine ran. The Company nominated natul gas in
accordance with industr practices for all hours in which the tubines ran.
Recordholder:
Sponsor:
Paul Clements
Paul Clements
PAC-E-I0-07/Rocky Mounta Power
November 18, 2010
Monsanto Data Request 16.12
Monsanto Data Request 16.12
At page 20, lines 13-14, Mr. Clements states that Monsanto is unable to provide
load-following services, spinng reserves, and other products that a combustion
tubine provides.
a. Has Mr. Clements determined the value ofload-followig services,
sping reserves, and other products provided by the Company's
combustion tubines? Please explain.
b. Please identify and define "other products" as used by Mr.
Clements in his testimony referenced above.
Response to Monsanto Data Request 16.12
a. No such analysis has been performed by Mr. Clements.
b. Other products include regulating reserves, black star capabilty, voltage
control, frequency response and dispatchabilty.
Recordholder:
Sponsor:
Paul Clements
Paul Clements
PAC-E-l 0-07/Rocky Mountain Power
November 18,2010
Monsanto Data Request 16.13
Monsanto Data Request 16.13
At page 21, lines 1-5, Mr. Clements states that the differences between the
products, terms and conditions Monsanto offers and the products, terms and
conditions available to the Company though ownership or lease of a combustion
turbine are too signficant in strctue and in value to warant a comparison for
use in determinig value for the Monsanto interrptible products.
a. Has PacifiCorp ever valued any non-firm load, DSM load, or any
other load on its system using the cost of a combustion tubine? If
yes, please cite and explain all such instaces and identify the cost
of the combustion tubine used in each instace.
b. Is it Mr. Clements' position that the differences between the
products, terms and conditions that DSM loads offer PacifiCorp
and the products, terms and conditions available to the Company
though ownership or lease of a combustion tubine are too
significant in strctue and in value to warant a comparson for
use in determing value for DSM loads on the PacifiCorp system?
Please explain.
c. Is it Mr. Clements' position that the differences between the
products, terms and conditions tht non-firm loads (not including
Monsanto) offer PacifiCorp and the products, terms and conditions
available to the Company through ownership or lease of a
combustion tubine are too signficant in structue and in value to
warant a comparison for use in determining value for non-firm
loads (not including Monsanto) on the PacifiCorp system? Please
explain.
Response to Monsanto Data Request 16.13
a. The Company uses an avoided cost methodology developed for valuation of
dispatchable load control programs. The methodology has been applied to the
Company's irrigation and Utah air conditioning dispatchable load control
programs. Please refer to the Company's response to Monsanto Request 16.10 for
a description of the methodology. All resource costs used in the valuation studies
come from the Company's latest filed IRP or IRP Update. The most recent
valuation studies used resource costs from the 2008 IR Update. The capital cost
for an intercooled aeroderivative simple-cycle combustion tubine, which serves
as the primar proxy replacement resource, is $1,084/kW. See pages 42-43 of the
2008 IRP Update for more details concerng resource capital costs.
b. Please refer to the Company's response to 16.13a above.
c. Please see Mr. Clements' direct testimony for his position on this issue.
P AC-E-l 0-07/Rocky Mountain Power
November 18,2010
Monsanto Data Request 16.13
Recordholder:
Sponsor:
Paul Clements
Paul Clements
PAC-E-I0-07/Rocky Mountan Power
November 18, 2010
Monsanto Data Request 16.1 4
Monsanto Data Request 16.14
Does Mr. Clements agree that PacifiCorp allocates the capacity costs of both
PacifiCorp owned and purchased resources to Monsanto when determining the net
rate paid by Monsanto?
Response to Monsanto Data Request 16.14
Mr. Clements is not the Company witness on cost of service. However, it is his
understading that relevant costs associated with PacifiCorp owned and
purchased resources are allocated to Monsanto based on the Revised Protocol
inter-jursdictional allocation methodology and the Company's cost of service
modeL.
Recordholder:
Sponsor:
. Paul Clements
Paul Clements
PAC-E-I0-07/Rocky Mountain Power
November 18, 2010
Monsanto Data Request 16.15
Monsanto Data Request 16.15
Is it Mr. Clements' position that 100% of Monsanto's load should be considered
firm when PacifiCorp determes whether to constrct or purchase firm
resources? Please explain.
Response to Monsanto Data Request 16.15
Please see the Rebutt Testimony of Gregory N. Duvall in Case No. PAC-E-10-
07 for a detailed explanation of the treatment of Monsanto load in the integrated
resource plan.
Recordholder:
Sponsor:
Paul Clements
Paul Clements