20180307PAC to Staff UT UIEC Set 2 (1-6).pdf

1407 W.North Temple
ROCKY MOUNTAIN Salt Lake City,UT 84116
POWER
A DMSION OF PACIFICORP
March 5,2017
William J.Evans
Vicki M.Baldwin
Chad C.Baker
Parsons Behle &Latimer
201 South Main Street,Suite 1800
Salt Lake City,Utah 84111
[e-mail]
[e-mail](W)
[e-mail] (W)
RE:UT Docket No.17-035-40
UIEC 2nd Set Data Request (1-6)
Please find enclosed Rocky Mountain Power's Responses to UIEC 2nd Set Data Requests 2.1-
2.6.Also provided is Confidential Response UAE 2.4.Confidential information is provided
subject to Public Service Commission of Utah (UPSC)Rule 746-1-602 and 746-1-603.
If you have any questions,please call me at [phone].
Sincerely,
Jana Saba
Manager,Regulation
Enclosures
C.c.:Erika Tedder/DPU [e-mail]@utah.gov(C)
Dan Kohler/DPU [e-mail](C)
Aliea Afnan/DPU [e-mail] (W)
jbower daymarkea.com (W)
Dan Peaco/DPU [e-mail] (C)(W)
Kevin Higgins/UAE [e-mail] (C)
Neal Townsend/UAE [e-mail](C)(W)
Gary A.Dodge/UAE [e-mail] (C)
Phillip Russell/UAE [e-mail] (C)
Philip Hayet/OCS [e-mail] (C)
Béla Vastag/OCS [e-mail](C)
Kate Bowman/UCE [e-mail](C)
Emma Rieves/UCE [e-mail](C)(W)
Lisa Tormoen Hickey/[e-mail] (C)
Mitch Longson/Interwest [e-mail] (C)
Nancy Kelly/[e-mail](C)
Jennifer Gardner/WRA [e-mail](C)
Penny Anderson/WRA [e-mail] (W)
Peter J.Mattheis/Nucor [e-mail] (C)
Eric J.Lacey/Nucor [e-mail] (C)(W)
17-035-40/Rocky Mountain Power
March 5,2018
UIEC Data Request 2.1
UIEC Data Request 2.1
Referring generally to the second supplementaltestimony of Rick Vail,where he
describes the interconnection studies TB Flats I and TB Flats II,Cedar Springs,Uinta,
and Ekola;
(a)Please identify the interconnection queue for TB Flats I and TB Flats II,Cedar
Springs,Unita,and Ekola;
(b)Please provide a narrative of the remaining steps,such as the facilities study,
interconnection agreement,and engineering,procurement,and construction process
for each of the resources;
(c)Please provide RMP's anticipated timeframes for completing these remaining steps;
(d)Please provide the standard OATT timeframes associated with these remaining steps;
(e)If there are any differences between the anticipated time frames and the standard
timeframes,please explain the basis for these differences.
Response to UIEC Data Request 2.1
(a)The queue positions are as follows:TB Flats I -Q0707,TB Flats II -Q0708,Cedar
Springs -Q0712,Uinta -Q0715/Q0810,and Ekola -Q0706.
(b)The Ekola project has an executed interconnection agreement and is scheduled to
commence design activities in late 2018.The remaining projects have complete
system impact studies (SIS)and are progressing to facilities studies.Followingthe
facilities study,PacifiCorp will tender an interconnection agreement,which will
contain project milestone dates associated with the design,construction and
commercial operation of the projects.
(c)PacifiCorp transmission estimates that facilities studies will be completed for TB
Flats I and II,Cedar Springs,and Uinta I and II in the May 2018/June 2018
timeframe.Please refer to the Company's response to subpart (d)below,for steps and
timeframes followingthe facilities study phase.
(d)Per the Open Access Transmission Tariff (OATT),PacifiCorp shall use reasonable
efforts to complete facilities studies within 90 calendar days followingthe execution
of a facilities study agreements,which all of the projects either have or are in the
process of executing.Interconnection customers then have 30 calendar days to
comment on the facilities study.PacifiCorp then has 30 calendar days to tender a
draft interconnection agreement.The parties have 60 calendar days to execute the
agreement unless mutuallyagreeing to extend that period.
17-035-40 /Rocky Mountain Power
March 5,2018
UIEC Data Request 2.1
(e)PacifiCorp does not anticipate any differences between anticipated and standard
timeframes.
17-035-40 /Rocky Mountain Power
March 5,20 18
UIEC Data Request 2.2
UIEC Data Request 2.2
Referring to lines 143-146 of the Second Supplemental Direct Testimony of Rick Vail
discussing new tower design and new tower testing;
(a)Please identify the current status of design,fabrication,and testing of the new tower
design,and state the anticipated dates for completing each step.
(b)When building the One Nevada line,NV Energy (through a contractor)caused to be
constructed "Advanced Electric Transmission Towers",which failed to withstand
sustained winds resulting in testing and mitigation measures which delayed operation
over one year and increased cost by 42.5 million dollars.Please describe how Rocky
Mountain Power plans to protect ratepayers in this Docket from a similar or different
failure risk with the new tower technology.
(c)Describe the estimated impact both to schedule and cost for this project,including
loss of PTC value,of a failure of the new towers and of a 12 month delay in
completing construction.
Response to UIEC Data Request 2.2
(a)A total of six lattice towers types are being designed for the project.All towers are
complete in geometry determination and member sizing to meet strength
requirements.Four towers have detailed design complete which makes the design
ready for fabrication.The detailed design for the remaining two towers will be
completed within the next month.The first tower is about to enter into fabrication at
the beginning of March 2018 to support a testing program scheduled for April 2018
through June 2018.
(b)The Company objects to the request on the basis that it is not relevant or reasonably
calculated to lead to the discovery of admissible evidence,is speculative and assumes
facts not in evidence.
(c)The Company objects to the request on the basis that it is not relevant or reasonably
calculated to lead to the discovery of admissible evidence,is speculative and assumes
facts not in evidence
17-035-40 /Rocky Mountain Power
March 5,2018
UIEC Data Request 2.3
UIEC Data Request 2.3
Referring to Rocky Mountain Power's response to DPU data request 19.1 regarding a
"round robin"generationrotation scheme;
(a)Please demonstrate and describe the reduction in estimated generation from the
Combined Projects and loss in PTC value resulting from the "round robin"generation
scheme.
(b)Will such a "round robin"generation scheme require reduction of existing generation
on the system?If so,please explain accomplish that reduction.
(c)Please explain how Rocky Mountain Power has accounted for such lost generation of
existing facilities as a result of the "round robin"generationscheme.Please provided
documents and work papers.
(d)Explain how Rocky Mountain Power proposes to protect rate payers from the lost
value of the curtailed existing generationand the lost generation of the Combined
Project,including but not limited to PTCs)from the "round robin"scheme.
Response to UIEC Data Request 2.3
(a)If the Company is in a situation where new wind turbine generators (WTG)are being
commissioned on a constrained transmission system,a "round robin"generation
rotation plan can be used to satisfy the production tax credit (PTC)requirement that
power from the wind turbine be put onto the grid on a regular basis.The "round
robin"plan would secure the long-term PTC benefits which are in place for the first
10 years a wind turbine is operational.
For example,a transmission system with 5,000 megawatts (MW)of capacity
connected to 4,000 MW of generationcapacity.Assume 2,000 MW of new wind
generationcapacity is added to the system on November 161 and then an additional
5,000 MW of transmission capacity is added on December 161.For the month of
November,there would be 6,000 MW of generationcapacity competing for space on
the transmission system that is limited to 5,000 MW.If all 6,000 MW of generation
resources tried to produce at the same time for a full hour in November,1,000
megawatt-hours (MWh)of generationwould need to be curtailed.For Company-
owned generationassets on a Company-owned transmission system,the Company
grid operators have the ability to decide which generation assets are curtailed at
which times.If the grid operators decided to curtail 1,000 MWh of wind generation
that was PTC eligible,the Company would lose the value of the 1,000 MWh of wind
generation and the PTC benefits related to the 1,000 MWh of wind generation due to
the transmission constraints of the system.
17-035-40/Rocky Mountain Power
March 5,2018
UIEC Data Request 2.3
In this demonstration,the "round robin"generation rotation plan would not prevent
the loss of wind PTC benefits for MWh of wind generationthat was curtailed during
the month of November due to transmission constraints,however the "round robin"
plan would secure the PTC benefits for the new wind equipment and allow them to
capture the full benefit of the PTC value during the remaining nine years and 11
months of the first 10 years the equipment is in operation and is attached to an
unconstrained transmission system.
Reductions in estimated generation for the Combined Projects would be dependent
upon the sum of generationresources attached to the transmission system and the
selection of which generationresources would be curtailed.Curtailments could also
be reduced by coordinating maintenance activities that would take some generation
resources offline for routine maintenance during times when new resources are being
added to the transmission system.
(b)The "round robin"plan would not require reduction of existing generation on the
system,but grid operations would have the option to reduce the generation at existing
facilities if such a decision was in the best interest of customers.
(c)The "round robin"plan is an option that could be used in the event there is a
substantial delay in the completion of the 500 kilovolts (kV)transmission system to
secure the long-term PTC benefits of the Combined Projects.The "round robin"plan
would be dependent upon multiplefactors and a complete financial evaluation has not
been undertaken at this point in time.
(d)The Company's planning for the option to use a "round robin"scheme of
commissioning and integrating the Combined Projects,as set forth in its illustration in
(a)above,will optimize the ability to comply with requirements necessary for
maximizingthe generation and tax benefits that otherwise would not be available.
Also,please refer to Ms.Crane's supplemental direct and rebuttal testimony,lines
203-210,which states "The Company will take every precaution to ensure that the
Wind Projects meet the requirements and timelines to qualify for full PTC benefits.
While we do not believe it is appropriate for the Company to absorb risks beyond its
control,we are prepared to accept risks associated with our perforrnance.We are
confident that we will complete the Combined Projects before the 2020 deadline".
Accordingly,the Company believes that planning for the potential use of a "round
robin"scheme is an effective approach to optimize commissioning and integration.
17-035-40 /Rocky Mountain Power
March 5,2018
UIEC Data Request 2.4
UIEC Data Request 2.4
Referring to Mr.Teply's supplemental direct and rebuttal testimony lines 554-557
regarding commercially available risk mitigation;
(a)Please describe in detail with specific references to the pro-forma contracts the risk
mitigation measures Rocky Mountain Power will include in the contract,including a
description of the risks these mitigation measures are intended to protect against.
(b)Please describe any exceptions to these contract mitigation measures raised by the
selected short list projects,and explain how these exceptions impact the mitigation
measures proposed by Rocky Mountain Power.
(c)Please describe,with references to the pro-forma contracts,the credit requirements
Rocky Mountain Power intends to require of the selected parties to cover these risks
and risk mitigation measures and explain how the selected parties have proposed to
meet those credit requirements.
Confidential Response to UIEC Data Request 2.4
(a)For the new wind benchmark pro-forma balance of plant (BOP)engineer,procure,
construct (EPC)contract,the followingkey risk mitigation measures are
representativelylisted:early contract termination opportunities,excessive early cost
commitments,subsurface condition assumptions,delays for extreme weather during
wind turbine generator (WTG)erection,delays for the WTG deliveryschedule,firrn
commodity prices,and conformityto the critical path schedule.
For the new wind benchmark pro-forma WTG supply contract,the followingkey risk
mitigation measures are representatively listed:early contract termination
opportunities,delays for the WTG delivery schedule,WTG performance,delays
during the WTG commissioning schedule,delays for extreme weather during WTG
deliveryand erection,and coordination with the BOP EPC contractor.
17-035-40 /Rocky Mountain Power
March 5,2018
UIEC Data Request 2.4
For the Build Transfer Agreements (BTA),the followingkey risk mitigation
measures are representativelylisted:credit position;subsurface condition
assumptions;delays for extreme weather during WTG delivery,erection,and
commissioning;control of the critical path schedule;intervention risks;scope of work
conformity;environmental matters,and asset reliability.
(b)Please refer to the Company's response to subpart (a)above.
(c)
17-035-40 /Rocky Mountain Power
March 5,2018
UIEC Data Request 2.4
Confidential information is provided subject to Public Service Commission of Utah
(UPSC)Rule 746-1-602 and 746-1-603.
17-035-40 /Rocky Mountain Power
March 5,2018
UIEC Data Request 2.5
UIEC Data Request 2.5
Regarding the supplemental direct and rebuttal testimony of Joelle Steward lines 147-154
wherein Rocky Mountain Power is unwillingto accept the risk that the commission will
not accept a future test year given the OCS and UAE prior challenges to such future test
years and referring to the second supplemental direct testimony of Rick Link lines 666-
675 referencing the appeal of the 2017R RFP;
(a)Explain why Rocky Mountain Power finds the risk of commission approval of a
future test year unacceptable,but finds it acceptable for Rocky Mountain Power to
advance the Combined Projects over the risk that the appellate court will vacate,
reverse,or remand the Commission's order in Docket 17-035-23 finding the
2017[R?]RFP to be in compliance with the Act.
(b)Please describe how Rocky Mountain Power has accounted for the economic,
scheduling,and other potential impacts on the Combined Projects of an appellate
ruling vacating,reversing,or remanding the PSC's Order approving the 2017R RFP
in PSC Docket No.17-035-23.
(c)If Rocky Mountain Power has to begin the 2017R RFP process again what impacts
will that have on the project economics and project completion schedule?
(d)Please describe how Rocky Mountain Power proposes to protect rate payers from the
consequences of a court order vacating,reversing,or remanding the PSC Order
approving the 2017R RFP in Docket No.17-035-23.
Response to UIEC Data Request 2.5
(a)The Company objects to the request on the basis that it is not calculated to lead to the
discovery of admissible evidence and is argumentative.
(b)The Company objects to the request on the basis that it is not calculated to lead to the
discovery of admissible evidence,is speculative and assumes facts not in evidence.
(c)The Company objects to the request on the basis that it is speculativeand assumes
facts not in evidence.
(d)The Company objects to the request on the basis that it is speculativeand assume
facts not in evidence..
17-035-40 /Rocky Mountain Power
March 5,2018
UIEC Data Request 2.6
UIEC Data Request 2.6
If the Combined Project is not complete by December 31,2020,does RMP intend to
replace the generationlost from the incomplete resources associated with the Combined
Project?
(a)If RMP intends to replace the lost generation,how does RMP intend to replace the
lost generation?
(b)How does RMP propose to allocatethe costs of the lost generation and replacement
generationbetween the RMP and the ratepayers?
To the extent this request includes a request for any responsive confidential or proprietary
information please redact such confidential or proprietary information from your
response to UIEC.For any redacted or withheld information,please:(1)identify the
document or describe the information being redacted or withheld,and (2)state the
reasons why the document or information is being withheld with sufficient specificity so
that the claim of confidentialityor proprietary information can be evaluated.Please send
nori-redacted responses to those parties requesting data request responses that have
executed Appendix A or a Nondisclosure Agreement under Rule R746-100-16.
Response to UIEC Data Request 2.6
(a)The Company will replace any Combined Project lost generationwith energy from its
other generation assets or from commercially favorable power purchase agreements
(PPA).
(b)The Company fully anticipates that it will successfully complete the Combined
Project by December 31,2020.To the extent that a delay occurs that is due to
circumstances beyond the Company's control,the Company will seek recovery of any
replacement generationthrough the Energy Balancing Account (EBA).Likewise,
replacement power costs attributable to delays due to circumstances within the
Company's control,would be addressed through the EBA for the relevant period.