20180307PAC to Staff WY WIEC Set 11 (1).pdf

ROCKY MOUNTAINPOWER
A DIVISION OF PACIRCORP 1407 W North Temple,Suite 330
Salt Lake City,Utah 84116
February 20,2018
Abigail C.Briggerman,#7-5476
Holland &Hart LLP
6380 South Fiddlers Green Circle,Suite 500
Greenwood Village,CO 80111
[e-mail](C)
RE:Wyoming Docket 20000-519-EA-17
WIEC 1lth Set Data Request (1)
Please find enclosed Rocky Mountain Power's Response to WIEC 1lth Set Data Request 11.1.
If you have any questions,please call me at [phone].
Sincerely,
Stacy Splittstoesser,
Manager,Regulation
Enclosures
C.C.:Meridith Bell/WPSC [e-mail](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)
Patti Penn/WIEC [e-mail](W)
Thor Nelson/WIEC [e-mail] (W)
Emanuel Cocian/WIEC [e-mail] (W)
Nik Stoffel/WIEC [e-mail] (C)(W)
Adele Lee/WIEC [e-mail] (W)
Crystal J.McDonough/[e-mail] (C)
Callie Capraro/NLRA [e-mail]
Christopher Leger/OCA [e-mail] (C)
Ivan Williams/OCA [e-mail](C)(W)
20000-519-EA-17 /Rocky Mountain Power
February 20,2018
WIEC Data Request 11.1
WIEC Data Request 11.1
Please refer to RMP Exhibit (RTL-4SD)and JRS Exhibits 2SD-4SD Repower WY
1.31.18 Work Papers.
(a)Please reconcile the annual Capital Recovery amounts provided in RMP
Exhibit (RTL-4SD)with the amounts provided on the "JRS-2SD"tab of JRS
Exhibits 2SD-4SD Repower WY 1.31.18 Work Papers.For example,the former
states that 2020 Capital Recovery is $113.562 million while the latter indicates that
the 2020 pre-tax return on rate base is $78.414 million and 2020 depreciation expense
is $32.635 million (for a total of $111.048 million).Why aren't the annual capital
costs provided in RTL-4SD and JRS-2SD the same?
(b)Were the Capital Recovery amounts provided in RMP Exhibit_(RTL-4SD)derived
from rate base amounts that are consistent with those provided on the "Rate Base and
Expense"tab of JRS Exhibits 2SD-4SD Repower WY 1.31.18 Work Papers?If so,
please demonstrate how the annual Capital Recovery amounts from RTL-4SD are
derived from the rate base amounts from the "Rate Base and Expense"tab of JRS
Exhibits 2SD-4SD Repower WY 1.31.18 Work Papers,using an Excel format work
paper.If not,please explain why the basis for the Capital Recovery amounts in RTL-
4SD differs from the rate base amounts on the "Rate Base and Expense"tab.
(c)Please provide a breakdown,in Excel format,of the annual dollar amounts of each
cost category included in the Capital Recovery amounts provided in RMP
Exhibit_(RTL-4SD).For example,please provide the annual net rate base,return on
rate base,depreciation expense,taxes,and any other category of costs included in the
Capital Recovery amounts.
(d)Please reconcile the annual Wind Tax amounts provided in RMP Exhibit_(RTL-4SD)
with the Wyoming Wind Tax amounts provided on the "Rate Base and Expense"tab
of JRS Exhibits 2SD-4SD Repower WY 1.31.18 Work Papers.Why aren't these
amounts the same?Do the Wind Tax amounts provided in RMP Exhibit (RTL-4SD)
represent the net wind tax (Repower Case netted against Status Quo
case¯
or the gross
Repower Case wind tax?
Response to WIEC Data Request 11.1
(a)Please refer to the Company's response to subpart (b)below.
(b)The Capital Recovery amounts provided in Exhibit RMP (RTL-4SD)were derived
from rate base amounts that differ from those provided on the "JRS-2SD"tab of "JRS
Exhibits 2SD-4SD Repower WY 1.31.18".
The Capital Recovery amounts in Exhibit RMP_(RTL-4SD)were calculated on row
76 on the "Summary"tab of the file "Data RePower Case 2018.01.30".This file was
provided with the confidential work papers supporting the supplemental direct
testimony of Company witness,Rick T.Link,specifically folder:"Wind Repower /
Linked Repower Case 2018.01.30".The Capital Recovery amounts were calculated
20000-519-EA-17 /Rocky Mountain Power
February 20,2018
WIEC Data Request 11.1
as follows:
i.Total capital investment of $1,116 million:
a.$1,101 million cost to repower.
b.$391 million capital replacements for repowered wind turbine generators
(WTG).
c.$24 million capital replacements for existing WTGs through repowering.
d.Avoided $400 million capital replacements for existing WTGs through
2040 that the Company would avoid due to repower.
ii.13-month average rate base.
iii.Total Company pre-tax rate of return of 9.16 percent.
iv.State specific property tax rates applied to the prior year's ending rate base;
that is,original cost less accumulated depreciation and accumulated deferred
income tax (ADIT).
The amounts provided on the "JRS-3SD"tab of "JRS Exhibits 2SD-4SD Repower
WY 1.31.18"were calculated as follows:
i.Total capital investment of $1,491 million:
a.$1,101 million cost to repower.
b.$391 million capital replacements for repowered WTGs.
c.This exhibit measures changes from amounts currentlyin rates;therefore,
avoided capital replacements associated with the existing WTGs is
excluded.
ii.Monthly calculation based on the prior month ending rate base.
iii.Wyoming pre-tax rate of return of 9.001 percent based on the approved capital
structure and cost from Docket 20000-469-ER-15.
iv.Property taxes of 0.77 percent of net book value (NBV);that is,original cost
less accumulated depreciation.The property tax rate is calculated per the
methodology demonstrated in Exhibit RMP_(JRS-4SD).
(c)The folder "Linked Repower Case 2018.01.30"referenced in the Company's
response to subpart (b)above contains a file for each of the repowering projects.The
annual dollar amounts of each cost category included in the Capital Recovery
amounts is included on rows 1724 through 1755 on the "Generic"tab of each file.
(d)The Wyoming Wind Tax amounts provided in Exhibit RMP_(RTL-4SD)are the net
wind tax;that is,Repower Case netted against Status Quo case.The wind tax
amounts are reduced from 2017 throughrepowering resulting from the decision to
20000-519-EA-17 /Rocky Mountain Power
February 20,2018
WIEC Data Request 11.1
defer major capital replacements on the existing WTGs in anticipation of repowering.
Post repowering the wind tax amounts increase as result of repowering.
The Wyoming Wind Tax on the "JRS-3SD"tab of "JRS Exhibits 2SD-4SD Repower
WY 1.31.18"measures changes from the amounts currentlyin rates.Therefore,the
Wyoming Wind Tax is calculated on the increased generationresulting from
repowering.
Respondent:Mark Paul and Terrell Spackman
Witness:Joelle Steward and Rick Link