20101221PAC to Monsanto 18 (1-22).pdf

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~~~OUNTAIN
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December 20,2010 ¿niû DEC 2 i Pri 2= l I
201 Soth Main, Suite 2300
Salt Lake City, Utah 84111
Radal C. Budge
RACIN, OLSON, NY, BUDGE &
BAlLEY, CEUTERED
P.O. Box 1391; 201 E. Center
Pocatello, Idaho 83204-1391
RE: il PAC-E-10-07
Monsanto Set 18 Data Requests (1-22)
Please fid enclosed Rocky Mounta Power's responses to Monsto Set 18 Data Requests
18.1-18.22. Provided on the enclosed CD are Attchments Monsato 18.4a, 18.5, 18.6, 18.9,
18.10,18.12,18.14, and 18.19b. Provided on the enclosed Confdential CD is Confdential
Atthment Monsanto 18.2, 18.3a, 18.4c, and 18.21b. The atthments Monsto 18.4a and
Confdential atthments Monsanto 18.3a, 18.4c, and 18.21b are being provided to the
requesting par only. The Confdential Atthments are Confdential and are provided subject
to the protective order in ths docket.
If you have any questions, please feel free to call me at [phone].
Sincerely,
jt T ePÚ/~ 14 ...J. Ted Weston ~
Manager, Reguation
Enclosur:
cc: Jea JewelllPUC (C)/3 copies
Erc Olsen/IIPA (C)
Ben Oto/ICL (C)
James R. Smithonsato (C)
Richard Anderson/onsanto (C)
George C. Carer, III/onsato (C)
Denns Peseau/onsanto (C)
Gareth R. KajanderlMonsanto (C)
Maurce BrubakerlMonsanto.(C)
Bri CollinslMonsanto (C)
Michael Gormanonsto (C)
Kath Iverson/onsanto (C)
Mark WidmerlMonsanto (C)
Melinda DaVIson/IIC (C)
Eric Lacey/Nucor Steel (DR 18.4)
PAC-E-1 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.1
Monsanto Data Request 18.1
Page 24, line 16 ofMr. Clements' Supplemental Testimony. The witness
recommends a total credit for the thee products of $6.1 millon in 2011. Please
provide this credit on a $ per kW -month basis for puroses of establishing an
interrptible demand charge. Please provide all calculations showing the
derivation of the proposed interrptible demand charge.
Response to Monsanto Data Request 18.1
Please refer to the Direct Testimony of Wiliam R. Grffith for supporting
information regarding biling determinats for Schedule 400, specifically Exhibit
No. 55, page 6. The anual ''Non-Firm kW" for Schedule 400 is 2,051,216.
Using the test period data, assuming a tota interrptible credit of$6.1 milion per
year, and assuming the interrptible credit is paid as a credit based on the Non-
Fir kW, the interrptible credit would be $2.97 per kW for all Non-Firm kW
($6.1 milion /2,051,216 kW = $2.97 per kW).
Recordholder:
Sponsor:
Paul H. Clements / Bil Griffth
Paul H. Clements
PAC-E-l 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.2
Monsanto Data Request 18.2
Please provide the revenue impact to Monsanto if the Company's requested
increase to firm rates is accepted along with the Company's proposed credit of
$6.1 millon. Please provide all workpapers supporting the revenue impact
showing the anual impact on both a dollar basis, and on a percentage basis.
Response to Monsanto Data Request 18.2
Please refer to Confidential Attchment Monsanto 18.2. Confidential inormation
is provided subject to the terms and conditions of the protective agreement in ths
proceeding.
Recordholder:
Sponsor:
J. Ted Weston
Paul H. Clements
P AC-E-1 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.3
Monsanto Data Request 18.3
Follow-up to Confidential Response to Monsanto Rebuttl Data Request 2.1.
Please provide the supporting calculations showing the 201 1 price paid by the
interrptible customer. Does this price reflect the Operating Reserve Credit
shown on page 18 of Mr. Clements' Supplemental Testimony? If so, please
identify and quatify the Operating Reserve Credit that was reflected in the price
shown in the Confidential Response to Monsanto Rebuttal Data Request 2.1. If
not, please show the overall price paid which reflects the inclusion of the
Operating Reserve Credit.
Response to Monsanto Data Request 18.3
Please refer to Confidential Attchment Monsanto l8.3a for the calculation of the
2011 price that the interrptible customer would pay. The price does not reflect
the Operating Reserve Credit shown on page 18 of Mr. Clements' Supplemental
Testimony. The Company does not have an overall price for ths customer for
2011 inclusive of the Operating Reserve Credit, because the Company does not
have the customer's energy usage for 2011. Confdential information is provided
subject to the terms and conditions of the protective agreement in this proceeding.
Recordholder:
Sponsor:
James Zhang
Wiliam R. Griffith
PAC-E-1O-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.4
Monsanto Data Request 18.4
For the Interrptible Customer #1 shown on page 18 of Mr. Clements'
Supplemental Testimony:
a. Please provide the Rate Case Percentage Changes and Effective Dates used
in adjusting the 2009 rates for 2010 and 2011. Please provide all supporting
workpapers used in developing the rates for 2010 and 2011.
b. Does this customer receive both an Operating Reserve Credit as shown on
the table, plus an economic curilment credt? Please fuly explain your
response.
c. What was the overal net price paid by Interrptible Customer #1 in 2010 for
electrc service with all so-called curilment products included (whatever
they may be labeled)? Please provide all supporting workpapers showing the
calculation of this price.
d. What is the overall net price paid by Interrptible Customer #1 in 2011 for
electrc service with all so-called curtilment products included (whatever
they may be labeled)? Please provide all supporting workpapers showing the
calculation of this price.
Response to Monsanto Data Request 18.4
a. Please refer to Attchment Monsato 18.4a for the requested information.
b. The customer receives a single credit amount for the interrptible product it
provides. The interrptible product terms and conditions included in the
customer's contract are such that the Company can call for an interrption
with a seven minute notice for any reason. Therefore ths interrptible
product can be used for non-spinnng operating reserves, economic
curailment, or for any other purpose desired by the Company with the
contract terms and conditions.
c. Please refer to Confidential Attchment Monsanto 18.4c. The calculation is
for January-November 2010. December 2010 data is not available. Ths
information is confidential and is provided subject to the terms and
conditions of the protective agreement in ths proceedig.
d. The Company is not able to provide the overall net price to be paid in 2011,
because the Company does not have the customer's energy usage for 2011.
Please also refer to the Company's response to Monsanto Data Request 18.3.
Recordholder:
Sponsor:
James Zhang / Paul H. Clements / Robert McCarhy
Paul H. Clements
PAC-E-1 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.5
Monsanto Data Request 18.5
With respect to Mr. Clements' Supplemental Testimony at page 20, lines 13-14
and page 21, lines 1-5, please provide the followig information:
a. Please provide by year the actul number of hour of load-following service
each Company owned or contrcted combustion tubine provided the
Company for the period 2007 though 2010 to date.
b. Please provide by year the actul number of hours of spinng reserve servce
each Company owned or contracted combustion tubine provided the
Company for the period 2007 though 2010 to date.
c. Please provide by year the actual number of hours of regulatig reserve
service each Company owned or contracted combustion tubine provided the
Company for the period 2007 though 2010 to date.
Response to Monsanto Data Request 18.5
a. Please refer to Attchment Monsanto 18.5 for the load following hour which
are synonymous with operating hours because resources are moved up and
down accordig to the loads to be covered.
b. The Company does not track the number of hours tht unts provide spinnng
reserves. To identify the number of hours for which specific units provided
sping reserves would require an investment of time and resources
incompatible with the time allowed to respond to discovery. This information
is not routinely prepared.
c. Please see response to par b.
Recordholder:
Sponsor:
Dean Haron / Greg Maxfield
Paul H. Clements
P AC-E-l 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.6
Monsanto Data Request 18.6
For each Company owned or contrcted combustion tuine, please provide by
year the actul number of tubine stas for the period 2007 though 2010 to date.
Response to Monsanto Data Request 18.6
Please refer to Attchment Monsanto 18.6.
Recordholder:
Sponsor:
Dean Haron
Paul H. Clements
PAC- E-l 0-07/Rocky Mountai Power
December 17, 2010
Monsanto Data Request 18.7
Monsanto Data Request 18.7
For each Company owned or contracted combustion tubine, please provide by
year the number of attempted tubine starts for the period 2007 through 2010 to
date.
Response to Monsanto Data Request 18.7
Please refer to Attchment Monsanto 18.6.
Recordholder:
Sponsor:
Dean Haron
Paul H. Clements
P AC-E-l 0-07/Rocky Mountain Power
December 17, 20 1 0
Monsanto Data Request 18.8
Monsanto Data Request 18.8
For each Company owned or contracted combustion tubine, please provide by
year the actual number of failed tubine stas for the period 2007 through 2010 to
date.
Response to Monsanto Data Request 18.8
Please refer to Attchment Monsanto 18.6.
Recordholder:
Sponsor:
Dean Haron
Paul H. Clements
P AC-E-l 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.9
Monsanto Data Request 18.9
For each Company owned or contracted combustion tubine, please provide the
unt's ramp rate.
Response to Monsanto Data Request 18.9
Please refer to Attchment Monsanto 18.9.
Recordholder:
Sponsor:
Andrew Hegewald
Paul H. Clements
P AC-E-l 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request I 8.1 0
Monsanto Data Request 18.10
For each Company owned or contrcted combustion tubine, please provide by
year the actul number of days for which natural gas was nominated for each
tubine for the period 2007 though 2010 to date.
Response to Monsanto Data Request 18.10
Please refer to Attachment Monsanto 18.10. Gas was nominated for each day the
. plants operated.
Recordholder:
Sponsor:
Paul H. Clements
Paul H. Clements
P AC-E-l 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.11
Monsanto Data Request 18.11
Page 8, line 15 of Mr. Clements' Supplemental Testiony. Please confirm or
deny that the "cost incurred to generate that megawatt" represents only the
rug cost, and no capacity cost. If denied, please explain in detail how the
capacity cost is included in the "opportty cost."
Response to Monsanto Data Request 18.11
Denied. Market price reflects some capacity cost. Please refer to Mr. Clements'
Supplemental Testimony page 14, line 19 through page 16, line 16 for Mr.
Clements' position.
Recordholder:
Sponsor:
Paul H. Clements
Paul H. Clements
PAC-E-1O-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.12
Monsanto Data Request 18.12
Please provide all testimony sponsored by the Company in the last ten years in
each of its jursdictions that references the "indifference priciple."
Response to Monsanto Data Request 18.12
To the extent ths request seeks all testimony sponsored by the Company related
to the "indifference principle" over a ten-year period, the Company objects on the
grounds that the request is overly broad and unduly burdensome. Without
waiving ths objection, provided as Attachment Monsanto 18.12, please find
testimony filed by the Company related to the PUR A ratepayer indifference and
ratepayer neutrality stadad as applied to QF pricing.
Recordholder: N/ A
Sponsor: N/ A
PAC-E-l 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.13
Monsanto Data Request 18.13
Page 11, line 18 of Mr. Clements' Supplemental Testimony. (a) Please provtde all
support for the statement that .the "proba. bilty of a double contingency even~
occurg is equal for all hours of the year." In the response, (b) provide the basis
for Mr. Clements' statement, as well as (c) identify all Company personnel i ith
whom Mr. Clements consulted to form his conclusion. I
Response to Monsanto Data Request 18.13 i
a. By its natue, the timing of a double contingency event canot be predicJed.
Such an event is never expected or planed, and thus it can occur at any time
(in any hour of a given year). I
b. Please refer to part (a) above for the basis for the referenced statement.
c. Rick Link, Manager, Pricing/Strctug and PacifiCorp real time personnel
were consulted.
Recordholder:
Sponsor:
Rick Link / Paul H. Clements
Paul H. Clements
P AC- E-1 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.1 1
Monsanto Data Request 18.14
Please provide the language used in the 2003 Contract with Monsanto as to
System Integrty and the definition used. If this languge is different than the
curent contrct language, please explain when this languge was changed and
upon what basis and upon which pary's insistence. Was Monsanto informed that
any change in the language of the System Integrty section would be used by the
Company as basis for claiming tht "it would not be reasonable to assume that a
double contingency would occur at the time of the Company's system coincident
peak for planng puroses" (see the Rebuttal Testimony of Gregory Duvall at p.
3 lines 18-20)? If so, please state when Monsanto was informed of this change
prior to the signng of the contract.
Response to Monsanto Data Request 18.14
Please refer to Attchment Monsanto 18.14 for the 2003 contract languge. The
curent contract language is different. The languge was modified stang with
the 2007 contract in order to more clearly define the types of events that qualify
. as a System Integrty Interrption. The Company requested these modifications
in order to more clearly define the product for puroses of more accurtely
determng the value of ths product and to avoid disputes over its use. The
Company defers answering the last two questions in this request on the grounds
that negotiations of the product terms and conditions occured durng confidential
settlement discussions until Monsanto waives any objection to providing these
answers.
Recordholder:
Sponsor:
Paul H. Clements
Paul H. Clements
PAC-E-l 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.15
Monsanto Data Request 18.15
Page 3,lines 18-20 of Gregory Duvall's Rebuttl Testimony. Please provide all
support for Mr. Duvall's statement that "it would not be reasonable to assume that
a double contingency would occur at the time of the Company's system coincident
peak for planing purposes." In the response, provide the basis for Mr. Duvall's
statement, as well as identify all Company personnel with whom Mr. Duvall
consulted to form his conclusion.
Response to Monsanto Data Request 18.15
The Company objects to this request on the basis that Mr. Duvall's rebuttl
testimony does not address valuation of interrptibility and was not submitted in
the curent phase of the proceeding addressing valuation ofinterrptibilty.
Without waiving this objection, the Company states tht the statement is based on
Mr. Duvall's experience and expertise in resource planng. A double
contingency event is not the expected condition; rather, it would more
appropriately be considered a worst case scenao. The Company plans for
expected conditions and therefore would not include a resource in its portfolio
that was only available under a worst case scenaro such as Monsanto's system
integrty product.
Recordholder:
Sponsor:
Gregory N. Duvall
GregoryN. Duvall
PAC-E- i 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18. i 6
Monsanto Data Request 18.16
Please confirm or deny that PacifiCorp may request System Integrty Interrptions
of up to i 62 MW if the System Integrty Interrption is voltage related. If denied,
please fully explain your response.
Response to Monsanto Data Request 18.16
Yes, PacifiCorp may request System Integrty Interrptions of up to 162 MW if
the System Integrty Interrption is voltage related.
Recordholder:
Sponsor:
Paul H. Clements
Paul H. Clements
PAC-E-l 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.17
Monsanto Data Request 18.17
Page 13 of Mr. Clements' Supplemental Testimony. At line 3, Mr. Clements
states, "For example, one modeL..". To which model is Mr. Clements referrng
here in his example, the GRID model, the Front Offce Model, or some other
model? Please fully explain your response.
Response to Monsanto Data Request 18.17
Mr. Clements is referrng to the Front Office modeL.
Recordholder:
. Sponsor:
Paul H. Clements
Paul H. Clements
P AC-E-l 0-07/Rocky Mountain Power
December 17, 2010
Monsato Data Request 18.18
Monsanto Data Request 18.18
Page 13 of Mr. Clements' Supplemental Testimony. At line 7, Mr. Clements
states, "A second modeL..". To which model is Mr. Clements referrng here in
his example, the GRID model, the Front Offce Model, or some other model?
Please fully explain your response.
Response to Monsanto Data Request 18.18
Mr. Clements is referrng to the GRID modeL.
Recordholder:
Sponsor:
Paul H. Clements
Paul H. Clements
PAC-E-10-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.19
Monsanto Data Request 18.19
Page 15 of Mr. Clements' Supplemental Testimony. At line 12, Mr. Clements
states "This represents what the Company would be wiling to pay on behalf of
customers for the next megawatt of operating reserves if it needed to acquire
additional operating reserves."
a. Please confirm or deny that both Laeside and Gadsby are used in the
Company's Front Offce Model for valuing operating reserves. If denied,
please fuly explain your response.
b. For the Front Offce and GRI model results shown at the top of page 15,
please explain what these values would be on a cost per megawatt basis, and
provide the calculations.
c. Please provide the cost per megawatt Rocky Mountain Power has incured on
behalf of customers to acquire Lakeside and Gadsby.
Response to Monsanto Data Request 18.19
a. The Company confirms that both Lake Side and Gadsby are used in the
Company's Front Office Model for valuing operating reserves.
b. Please refer to Attchment Monsanto l8.19b for the calculations and cost per
megawatt basis.
c. Lakeside = $630/kW
Gadsby Peakers = $632/kW
Recordholder:
Sponsor:
Rick Link
Paul H. Clements
P AC-E- i 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.20
Monsanto Data Request 18.20
Please reconcile the following two statements of Mr. Clements with the results of
his two models shown at the top of page i 5 which indicate the GRID model
values are consistently equal or lower than the Front Offce values:
Front Offce Model: "This model determnes ... the most economic or least cost
means by which the Company can provide operating reserves" (page 15, lines 6-8,
emphasis added)
GRID Model: "This value represents the value of the highest cost, or most
expensive, operatig reserves that would no longer be required if Monsanto's
operating reserve product is available intead." (page 16, lines 1 0-12, emphasis
added).
Why are the GRID Model results 10wer if the model supposedly represents the
"most expensive" operating reserves no longer required?
Response to Monsanto Data Request 18.20
The statement made with regard to the Front Office Model is intended to describe
the concept of a reserve supply stack in which operating reserves are assumed to
be held on the lowest cost resource in the stack. In this approach, the amount of
reserves needed are not considered.
The statement made with regard to GRID is intended to describe the concept of
marginal cost pricing where the cost of reserves is established by the cost ofthe
last (or marginal) resource in a supply stack given a specific need for reserves.
The Front Office Model uses a simple reserve supply stack to ascribe a reserve
value regardless of reserve demand, and GRID uses a full portfolio of resources
tht can be used to satisfy a specific level of reserve demand. It is ths
fundamental difference in approach that drves differences in the operating
reserve valuation from the two models.
Recordholder:
Sponsor:
Rick Lin
Paul H. Clements
PAC-E-1O-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.21
Monsanto Data Request 18.21
At page 17 of Mr. Clements' Supplemental Testimony, he discusses two contracts
with large industral customers for non-spinnng operating reserves. Monsanto
requested copies of those contrcts in its First Set of discovery to Rocky
Mountain Power in 1-27 and 1-30.
a. For the contrct executed in late 2006, please indicate where in the provided
contrct the credit for non-spinning operating reserves is discussed. If not
referenced in the contract provided to Monsanto, please: (1) provide the
contract which does discuss non-spinng operating reserves provided by the
large industral customer; (2) indicate why this contract was not provided
when initially requested by Monsanto and (3) explain the source of the
curilment credit shown on page 8 of Confidential Attchment 1.27.
. b. For the contrct executed in late 2006, provide all workpapers and
calculations used in developing the $4.16/kW month initially set and the
$4.25/kW month average for 2007-2010.
Response to Monsanto Data Request 18.21
a. The Curilment Credit includes non-spinnng reserves, as discussed in the
Company's response to Monsanto Data Request 18.4b. The curailment credit
is discussed in Aricle IV of the agreement referenced above. Terms and
conditions of the curailment are included in Exhbit B to the agreement. This
contract was provided to Monsanto in the Company's response to Monsanto
Data Request 1.27. For the source of the curtilment credit shown onpage 8
of Confidential Attchment 1.27, which includes non-spinníng reserves,
please refer to response to par b below.
b. Please refer to Confdential Attchment Monsanto 18.21 b. Additional work
papers are highy confidentiaL. Please contact Ted Weston at 801-220-2963 to
discuss arangements for review onsite.
Confidential information is provided subject to the terms and conditions of the
protective agreement in ths proceeding.
Recordholder:
Sponsor:
Rick Link / Paul H. Clements
Paul H. Clements
P AC-E-l 0-07/Rocky Mountain Power
December 17, 2010
Monsanto Data Request 18.22
Monsanto Data Request 18.22
At page 22 of Mr. Clements' Supplemental Testimony, lines 12 - 15, he states that
"The Company uses the GRI model to determine net power costs in this rate
case. Since Monsanto's interrptible credit is included as a component of net
power costs, it is logical to use the same model to determine value of the
interrptible products provided by Monsanto."
a. Please confirm or deny that Rocky Mountain Power includes its own
generation resources as a "component of net power costs." If denied, please
fully explain your response.
b. If Rocky Mountai Power's own generation resources are included as a
component of net power costs, why are capital costs of those resources
included in rate base? Please fully explain your response.
c. Please confirm or deny that the GRID model is strctly energy based in that it
measures the difference in system net power costs with and without
Monsanto. If denied, please fully explain your response.
d. Please confirm or deny that the GRID model does not include any cost
reductions associated with capacity resource deferrals. If denied, please fully
explain your response.
Response to Monsanto Data Request 18.22
a. Confirm. Rocky Mountain Power includes its own generation resources as a
component of net power costs.
b. Net power costs include the fuel expense associated with dispatching the
Company's generation resources. Net power costs do not include the capital
costs of the resources. Capital costs are included in rate base so that
investors have an opportty to ear a retu of and a retu on their
investrent in the electrc utility industry.
c. Confirm and deny. The GRI model measures the difference in system net
power costs. It is not strctly energy based.
d. Deny. The GRID model includes market purchases which can be deferred.
Market purchases are firm power and have a "capacity" component.
Recordholder:
Sponsor:
Hui Shu
Paul H. Clements