20170829Utah_OCS Set 4 (1-12) Redacted.docx

BEFORE THE PUBLIC SERVICE COMMISSION OF UTAHIn the Matter of the Voluntary Request:Docket No. 17-035-39Of Rocky Mountain Power for Approval:Office of Consumer ServicesOf Resource Decision to Repower:Fourth Data Request toWind Facilities:Rocky Mountain Power:August 18, 2017Please provide responses to:Béla VastagPhilip HayetOffice of Consumer ServicesJ. Kennedy and Associates, Inc.160 East 300 South 570 Colonial Park Drive, Suite 305Salt Lake City, Utah 84111Roswell, GA 30075(801) 530-6374(770) [e-mail]@jkenn.comREDACTED
Regarding Historic vs. Projected Market Impacts:
Please provide a summary of historic market purchases and sales volumes, dollars, and average prices by month by wholesale market since the Company began participating in the EIM.
Has the Company performed any analysis comparing the SO or PaR model purchase and sales energy results to historical purchase and sales energy results to validate the reasonableness of the modeled results. If so, please provide any workpapers and reports, of such comparisons the Company has conducted. If not, please explain why not, especially if market purchases and sales are expected to be a significant driver of the benefits of the repowered wind.
It appears that consistently across SO fuel and CO2 cases, a significant portion of the benefits are driven by purchases and sales at the MIDC market, as a result of the repowered wind projects. What basis does the Company have to believe that over the 2020 to 2050 time-period, it is reasonable that the repowered wind projects would be able to derive such significant benefits from purchases and sales at the MIDC market?
In light of PacifiCorp’s participation in the EIM, and consideration of joining the CAISO, please explain why the benefits of the repowered wind projects derived in the SO from transactions at COB are so small when compared to the benefits derived from transactions at MIDC?
Please explain why that when compared to all 9 cases in the SO Repower analysis, the Low Gas, Mod CO2 case produces dramatically higher benefits (xxxxxxxxxxxx XXX xxxxx xx x XXX xxxx) associated with transactions at MIDC compared to the benefits produced by transactions at any other market.
Please explain why that when compared to all 9 cases in the SO Repower analysis, the High Gas, Mod CO2 case produces such high benefits (xxxx xxx XXXxxxxx xx x XXX xxxx) associated with transactions at Four Corners. The benefits from transaction at Four Corners in that case are 4 to 5 times greater than then benefits at Four Corners in any other fuel/CO2 cases considered.
Regarding market impacts expected from repowering:
Please explain if/how repowering provides market benefits and additional access to the spot energy markets.
Please explain if/how repowering provides market benefits and additional access to the Mid-Columbia market.
Please explain if reduced purchases and increased sales at the Mid-Columbia market would be facilitated by specific repowering projects more so than others (for example, does transmission constrain the repowered Wyoming wind projects access to the Mid-C market).
Do the significant benefits from increased market sales at Mid-C derive primarily from the repowered wind projects in Washington and Oregon versus the repowered wind projects in Wyoming?
Please perform the PaR and SO analysis assuming only the Washington and Oregon re-powering projects are completed.
Please perform the PaR and SO analyses assuming only the Wyoming re-powering projects are completed.
After the wind projects are repowered, the wind generators will increase in capacity, and will be able to produce more energy. Without transmission upgrades, will there be an increase in the number of times when wind turbines will have to be limited in some way due to transmission constraints? If so please explain how the system operators will operate the units under this situation. For example, will dump energy occur? If transmission constraints are not likely to increase with the repowered wind, please explain why not.
Are there times in the SO or PaR analyses when the amount of wind energy in an hour exceeds the transfer capability input in the model from the region where the repowered wind resources are located, particularly the Wyoming wind projects? If so how does the model treat that energy, for example does the model report dump energy, and how is it priced out in the SO and PaR? If not, please explain why
Please refer to the Company’s response to OCS 1.12. Please provide complete and differentiated responses for both FOT and system balancing transactions.
Please be more specific to explain how market depth was modeled in the Repowering analysis. In other words, are the markets themselves constrained with a market depth input variable/logic, or is the only limit on the amount of sales that can be made at any of the markets, the market price and the transmission transfer capacity inputs that are modeled?
If market depth inputs were modeled, please provide the market depth inputs assumed in the Repowering analysis.
Please provide an explanation of how the Company modeled market depth in the last General Rate Case and provide the inputs that it modeled in GRID. Please provide workpapers showing the derivation of those market depth inputs, and if there are differences in market depth assumptions between what was used in the General Rate Case and what is being used in the Repowering Study, please explain the differences and the reason different assumptions were used.
Please provide evidence and supporting documentation for the volume of market transactions the company has historically been able to make at each market hub.
Refer to DPU 3.18 and DPU 4.1. It appears the Company has performed analysis of each existing wind turbine to assess the expected remaining life of each unit. Please provide the remaining useful life estimates for each wind facility under consideration for re-powering. Please itemize assessments if separate estimates have been conducted for energy collection systems, gearboxes, blades, nacelles, foundations, etc. If different lives for components are identified, please provide a single remaining useful life/ retirement date that represents the project as a whole. Provide any workpapers, reports, studies, etc. that the Company has performed or reviewed in developing these estimates.
When comparing the case without repowering to the case with repowering, approximately 70 MW of additional capacity is acquired through the repowering. When the PaR study period ends in 2036, the Company extends the PaR study through 2050 and has determined that the repowering will provide an additional 10 years of life on 1,000 MW of wind capacity. During the extension period, the Company computes a benefit of having 1,000 MW of wind capacity, and it calculates its estimate of the benefits during that period from the calculated benefit of having 70 MW of incremental repowering capacity that occurred before 2036.
Provide evidence/the Company’s justification for the reasonableness of assuming that the benefit of the 1,000 MW during the extension period could be linearly scaled from the benefit of the 70 MW up to 2036.
Has the Company ever performed an economic analysis in which it derived extension period benefits in a similar manner? If so, please identify the proceeding, and provide the testimony of the witness that supported such a methodology.
From the “TieCF…” SO output file, there appears to be about a xxxXX xxxxxxxx xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxXxxxxxx transmission tie when comparing the wind repowering case to the base case. Please explain why this difference in assumptions exists.
Please see Repower Results Direct Testimony.xlsm, Tab = Price-Policy Annual – PaR at line 72. The repowering benefits seem unusual in that the NPC ($/MWH) go from $68.39/MWH in 2030 to $190.79 in 2032 to $40.85/MWH in 2035. It would seem that a benefit as high as $190.79/MWH is quite a large value given that the added wind is approximately just 70 MW. Please explain the reasonableness of these NPC benefits.
Please see Repower Results Direct Testimony.xlsm, Tab = Price-Policy Annual – PaR at line 72, and Tab = PaR Sensitivity at line 75. Explain why the Company’s repowering NPC $/MWh benefit appears to be so much higher in the Repowering analysis than it is in the PaR Sensitivity analysis?
Please explain why the Company believes that it is reasonable that the benefits in the Repowering PaR analysis through 2036 ranges from a dis-benefit of $43 million to a positive benefit of $80 million, yet when the results are extended to 2050, the range is much greater, with a low benefit of $41 million and a high benefit of $589 million. In other words, explain why the benefits increase so dramatically when the study period is extended from 2036 to 2050. Note that the increase in benefits in the New Wind/Transmission case when the PaR benefits are extended is not nearly as significant as in the Repowering analysis.
In comparing SO to PaR results in the Repowering analysis, it appears that the SO has greater benefits in every fuel/CO2 case compared to the PaR results. However, when the same comparison is made in the New Wind/Transmission case, the SO has lower benefits in every case except for 2 (High Fuel/Zero CO2, and High Fuel/Med CO2) cases. Please explain the reasonableness of these results switching direction in these two studies, and rule out the possibility of any errors in the analysis.