20170925Wyoming_WPSC Set 3(1-2).pdf

ROCKY MOUNTAIN
POWER
A DIV1SION OF PACIFICORP 1407 W North Temple,Suite 330
Salt Lake City,Utah 84116
August 18,2017
Meridith Bell
2515 Warren Avenue,Suite 300
Cheyenne,Wyoming82002
[e-mail](C)
RE:Wyoming Docket 20000-519-EA-17
WPSC 3rd Set Data Request (1-2)
Please find enclosed Rocky Mountain Power's Responses to WPSC 3rd Set Data Requests 3.1-
3.2.
If you have any questions,please call me at [phone].
Sincerely,
Stacy Splittstoesser,
Manager,Regulation
Enclosures
C.C.:Lori L.Brand/WPSC [e-mail] (W)
John Burbridge/WPSC [e-mail] (W)
Michelle Bohanan/WPSC [e-mail] (W)
Kara Seveland/WPSC [e-mail](W)
Morgan Fish/WPSC [e-mail] (W)
Marci Norby/WPSC [e-mail] (W)
Abigail C.Briggerman/WIEC [e-mail]
Patti Penn/WIEC [e-mail](W)
Bob Pomeroy/WIEC [e-mail] (W)
Thor Nelson/WIEC [e-mail] (W)
Emanuel Cocian/WIEC [e-mail](W)
20000-519-EA-17 /Rocky Mountain Power
August 18,2017
WPSC Data Request 3.1
WPSC Data Request 3.1
Please provide the estimated proposed financing for the $1.13 billion for the Wind
Repowering project.Please include a breakdown of long-term debt,equity,short-term
debt,retained earnings,preferred stock,etc.How will the Company obtain this
financing?What is the Company's estimated capital structure before and after the
proposed Wind Repowering project and New Wind and New Transmission project?
How will the proposed securities outstandingcompare with the fair value of the
businesses and propertiesbefore and after the issuance of securities for the Wind
Repowering and New Wind and New Transmission projects?Please discuss and describe
in detail and provide any calculations used.
Response to WPSC Data Request 3.1
The Company intends to finance the proposed Wind Repowering and New Wind projects
and New Transmission project through its normal sources of capital,both internal and
external,including net cash flow from operating activities,the issuance of new long-term
and short-term debt and,if necessary,capital contributions.
In comparison to current plan,the Company projects during the proposed 2018-2021
build period an increase in long-termdebt issuances of $1.0 billion,and a net decrease in
dividends to parent of approximately $900 million.
Provided below are the Company's projected 12 month average capital structure
percentages for 2018-2021 for the current plan in comparison to the "new project
scenario"that includes financing for the Company's proposed Wind Repowering and
New Wind projects and New Transmission projects.In determining each of the capital
structures below,the Company has averaged the five quarter-end capital structures
spanning the 12-month periods ended.
PacifiCorp
Capital Structure Percentages
Forecast Forecast Forecast Forecast
12/31/2018 12/31/2019 12/31/2020 12/31/2021
current Plan
Long-Term Debt 48.55%48.55%48.63%48.54%
Preferred Stock 0.02%0.02%0.02%0.02%
Common Equity 51.43%51.43%51.35%51.44%
New Project Scenario
Long-Term Debt 48.56%48.60%48.57%48.58%
Preferred Stock 0.02%0.01%0.01%0.02%
Common Equity 51.42%51.39%51.42%51.40%
20000-519-EA-17 /Rocky Mountain Power
August 18,2017
WPSC Data Request 3.1
For the requested comparison of securities outstandingcompared to the fair value of the
businesses and properties,before and after the Wind Repowering,New Wind and New
Transmission projects,the Company provides the followingprojected balances for
securities outstanding and net book value of total assets for PacifiCorp as of 12/31/17 and
12/31/21.For reference purposes,actual 12/31/16 balances are provided as well.
PacifiCorp
$000s
Actual Forecast Forecast
12/31/2016 12/31/2017 12/31/2021
Total Long-Term Debt (principal)$7,093,197 $7,041,475 $7,972,150
Total Preferred Stock 2,398 2,398 2,398
Total Common Equity (1)7,386,862 7,549,946 8,734,979
Securities outstanding $14,482,457 $14,593,818 $16,709,527
Fair value of properties and business (2)$22,394,169 $22,452,895 $24,859,494
(1)All outstanding shares of PacifiCorp common stock are owned by PPW Holdings LLC,a
wholly owned subsidiaryof Berkshire Hathaway Energy Company.
(2)For purposes of this request,represents thetotal assets (net)as setforth for SEC Form 10-K
balance sheet reporting.It may not reflect the fair value of properties and business for tax
assessment or valuations for other purposes.
Respondent:Ryan Weems
Witness:Cindy Crane
20000-519-EA-17 /Rocky Mountain Power
August 18,2017
WPSC Data Request 3.2
WPSC Data Request 3.2
How will bonus tax depreciationand ADIT be accounted for in each of the years from
2016 to 2023 for the Wind Repowering project,please describe in detail both with and
without the proposed nontraditional ratemaking?
Response to WPSC Data Request 3.2
Bonus tax depreciation and ADIT balances will be included in the RTM as an offset to
the rate base as described in Exhibit RMP_(JKL-5).ADIT,including ADIT associated
with bonus tax depreciation,will be included in the plant revenue requirement RTM
deferral.The ADIT included in the RTM deferral will be calculated as the New
Accumulated Deferred Income Tax (the actual accumulated deferred income tax balances
associated with the Combined Projects)less the Base Accumulated Deferred Income Tax
(the amounts booked into accumulated deferred income tax related to the Combined
Projects that have been included in base rates through a general rate case).This treatment
will be the same under nontraditional and traditional ratemaking.
Respondent:Steve McDougal
Witness:Jeff Larsen