20210721PAC to Staff 35-49.pdf

1407 W North Temple, Suite 330 Salt Lake City, Utah 84116
July 21, 2021 Jan Noriyuki Dayn Hardie Idaho Public Utilities Commission
472 W. Washington Boise, ID 83702-5918 [e-mail] (C)
RE: ID PAC-E-21-07 IPUC Set 2 (35-49) Please find enclosed Rocky Mountain Power’s Responses to IPUC 2nd Set Data Requests 35-49. Provided via e-mail are the non-confidential Attachment and via BOX are the Confidential Attachments. Confidential information is provided subject to protected under IDAPA
31.01.01.067 and 31.01.01.233, the Idaho Public Utilities Commission’s Rules of Procedure No. 67 – Information Exempt from Public Review, and further subject to any subsequent Non-Disclosure Agreement (NDA) executed in this proceeding. If you have any questions, please feel free to call me at [phone]. Sincerely,
____/s/____
J. Ted Weston Manager, Regulation Enclosures C.c.: Ronald L. Williams/PIIC [e-mail] Bradley G. Mullins/PIIC [e-mail] Adam Gardner/PIIC [e-mail] (W) Kyle Williams/PIIC [e-mail] (W) Val Steiner/PIIC [e-mail] (W)
Eric L. Olsen/IIPA [e-mail] (C)
Anthony Yankel/IIPA [e-mail] (C) Randall C. Budge/Bayer [e-mail] (C) Thomas J. Budge/Bayer [e-mail] (W)(C) Brian C. Collins/Bayer [e-mail] (W)(C) Maurice Brubaker/Bayer [e-mail] (C) Kevin Higgins/Bayer [e-mail] (C) Lance Kaufman/Bayer [e-mail] (C)
RECEIVED
2021July 21, PM 4:05
IDAHO PUBLIC
UTILITIES COMMISSION
James R. Smith/Bayer [e-mail] (C) Brad Purdy [e-mail] (C) Ben Otto/ICL [e-mail] (C)

PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 35
IPUC Data Request 35 Please describe the Company's method(s) for developing, managing, executing, and completing Capital Projects in a least-cost manner. Please provide a copy of
all Company policies and procedures documenting this method.
Response to IPUC Data Request 35
PacifiCorp has several policies, procedures, and internal controls in place for
developing, managing, executing, and completing capital projects in a risk adjusted least-cost manner. This process begins with the Integrated Resource Plan, which is updated every two years, where system needs are identified and evaluated for risk adjusted least-cost solutions.
On an annual basis the Company prepares a ten-year business plan where system
needs are considered. During the business plan process capital projects are evaluated and categorized based on investment drivers, then scoped, and budgeted to minimize cost and schedule changes based on preliminary engineering analysis.

As projects move closer to initiation alternatives are considered to identify the most cost-effective solutions. Once a final solution is selected project scope and schedules are optimized to minimize cost and scope changes. Once a final solution is selected the level of planning, engineering, and cost estimates are refined. Project schedules are vetted to increase confidence in meeting milestones
and in-service dates.
Annual capital budgets are established and capital projects are selected based on the project categorization. Categories include system reliability and
reinforcement, asset replacement, risk management, customer new connects,
overhauls, environmental requirements, etc. The Company also utilizes competitive procurement practices to ensure materials and contracts are sourced which are cost-competitive and meet the project requirements. PacifiCorp's procurement policy provides for obtaining goods and
services at the lowest evaluated cost, consistent with business objectives
including, but not limited to, safety, service, technical performance, sustainability, and schedule requirements. PacifiCorp utilizes one or more competitive processes to obtain the best value for customers in the procurement of goods and services required for the provision of safe, cost effective, and reliable power. These processes rely on fair and open competition among qualified suppliers to provide the goods and services required to satisfy business requirements. These ensure that suppliers are treated fairly and equitably. The requirements outlined in the Company’s Procurement Policy are in
PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 35
place to ensure that the Company's procurement objective of obtaining the best value for the Company and its customers are met. Please refer to Attachment IPUC 35-1 and Confidential Attachment IPUC 35-2
which provide copies of the Company’s policies and procedures for the
management of capital expenditure projects. Confidential information is provided subject to protection under IDAPA
31.01.01.067 and 31.01.01.233, the Idaho Public Utilities Commission’s Rules of
Procedure No. 67 – Information Exempt from Public Review, and further subject to the Non-Disclosure Agreement (NDA) executed in this proceeding. Recordholder: Various

Sponsor: To Be Determined

PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 36
IPUC Data Request 36 Please describe the methods used at the Craig Generating Station to ensure capital investment projects were completed in a least-cost manner. Please include any plant specific guidelines and procedures documenting these methods. Response to IPUC Data Request 36
Craig Unit 1 and Craig Unit 2 are joint owned facilities with PacifiCorp’s
ownership being 19.28 percent in each (Tri-State Generation and Transmission is the operator). Tri-State’s procurement program is followed for construction of capital projects at the Craig Station. As noted under item C on page 2 of the procurement program:
“Tri-State will use competitive procurement practices to the greatest extent
practical to facilitate acquisition of materials, goods, equipment and services at the lowest evaluated total cost”.
Tri-State also has a request for proposals (RFP) process that is followed during
the completion of capital projects at Craig Station that states: “The Request for Proposal (RFP) process will be used to determine the best marketplace solution for Tri-State at the best possible cost”. In addition to the work done by the operator, PacifiCorp reviews capital projects
for necessity and cost, then votes accordingly. PacifiCorp works with other
owners to discuss which capital projects to pursue at our engineering and operations (E&O) meetings and in additional budget and project meetings as necessary. Aspects of running the plant are discussed at the E&O meetings
including financial issues in addition to the engineering and operational issues.
The joint plant owners vote on capital projects, which for approval require majority of owners. Please refer to Confidential Attachment IPUC 36 which provides copies of Tri-State’s procurement program and RFP process.

Confidential information is provided subject to protection under IDAPA 31.01.01.067 and 31.01.01.233, the Idaho Public Utilities Commission’s Rules of Procedure No. 67 – Information Exempt from Public Review, and further subject to the Non-Disclosure Agreement (NDA) executed in this proceeding.
Recordholder: Mike Johanson Sponsor: Chuck Tack
PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 37
IPUC Data Request 37 Please provide all documentation for plant investments made at the Craig Generating Station since 2013, between the Company and its operating partner showing how the Company was engaged with its operating partner to minimize
plant investment costs. Please include any documentation justifying the need for an upgrade, documentation questioning the need for an upgrade, and any analysis comparing the cost and benefits of other alterative considered.
Response to IPUC Data Request 37 The Company objects to the request for ALL documentation for every plant investment made since 2013 because it is vague and unduly burdensome. Without waiving this objection, pursuant to an agreed upon resolution with the staff of the
Idaho Public Utilities Commission the Company responds as follows:
Please refer to the Company’s response to IPUC Data Request 48.

Recordholder: Various Sponsor: To Be Determined

PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 38
IPUC Data Request 38 Please list every Craig Generating Station capital project with a budget of $250,000 or more completed since 2013, that used internal resources (internal defined as any ownership partner) instead of an outside contractor. For each
capital project listed, please explain why internal resources were used instead of an outside contractor.
Response to IPUC Data Request 38
Please refer to IPUC Data Response 37. Recordholder: Various

Sponsor: To Be Determined

PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 39
IPUC Data Request 39 Please describe the methods used at the Colstrip Power Plant to ensure capital investment projects were completed in a least-cost manner. Please include any
plant specific guidelines and procedures documenting these methods.
Response to IPUC Data Request 39
Colstrip Unit 3 and Colstrip Unit 4 are joint owned facilities with PacifiCorp’s
ownership being 10 percent in each (Talen Energy is the operator). For many of the overhaul or maintenance type projects, the repairs are condition-based following inspections and reviewed by the project engineers ensuring only necessary work is completed.

Projects are competitively bid as appropriate: - Sole source justifications are scrutinized when used.

- Where some projects may be sole-sourced to specialty contractors, those contractors were typically selected through a bid process initially. Projects are timed in a manner to minimize the impact to generation. Projects are completed during low cost power periods. Projects are justified and that
justification is scrutinized by the ownership group during the budget process.
In addition to the work done by the operator, PacifiCorp reviews capital projects for necessity and cost, then votes accordingly. PacifiCorp works with other
owners to discuss which capital projects to pursue at our engineering and
operations (E&O) meetings and in additional budget and project meetings as necessary. Aspects of running the plant are discussed at the E&O meetings including financial issues in addition to the engineering and operational issues. The joint plant owners vote on capital projects, which for approval require majority of owners.

Recordholder: Mike Johanson Sponsor: Chuck Tack
PAC-E-21-07 / Rocky Mountain Power July 22, 2021 IPUC Data Request 40
IPUC Data Request 40 Please provide all documentation for plant investments made at the Colstrip Power Plant since 2013, between the Company and its operating partner showing how the Company was engaged with its operating partner to minimize plant
investment costs. Please include any documentation justifying the need for an upgrade, documentation questioning the need for an upgrade, and any analysis comparing the cost and benefits of other alternatives considered.
Response to IPUC Data Request 40 The Company objects to the request for ALL documentation for every plant investment made since 2013 because it is vague and unduly burdensome. Without waiving this objection, pursuant to an agreed upon resolution with the staff of the
Idaho Public Utilities Commission the Company responds as follows:
Please refer to the Company’s response to IPUC Data Request 48.

Recordholder: Various Sponsor: To Be Determined
PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 41
IPUC Data Request 41 Please list every Colstrip Power Plant capital project with a budget of $250,000 or more completed since 2013, that used internal resources (internal defined as any ownership partner) instead of an outside contractor. For each capital project listed,
please explain why internal resources were used instead of an outside contractor. Response to IPUC Data Request 41

Please refer to the Company’s response to IPUC Data Request 40. Recordholder: Various
Sponsor: To Be Determined

PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 42
IPUC Data Request 42 Please describe the methods used at the Hayden Power Plant to ensure capital investment projects were completed in a least-cost manner. Please include any plant specific guidelines and procedures documenting these methods.
Response to IPUC Data Request 42
Hayden Unit 1 and Hayden Unit 2 are joint owned facilities with PacifiCorp’s
ownership being 24.5 percent and 12.6 percent, respectively in each (Xcel Energy is the operator). Capital investment project requests are reviewed by a capital investment project team to ensure the project is justified and the most cost-effective solution has
been considered. During the project execution stage, the supply chain group
ensures the least cost purchase is made through competitive bidding, and/or through pre-negotiated master service agreements.
The capital investment project team is made up of representatives from the plants
and centralized technical support organizations. The team is led by the manager of a central organization to drive neutrality in decisions. In addition to the work done by the operator, PacifiCorp reviews capital projects for necessity and cost, then votes accordingly. PacifiCorp works with other
owners to discuss which capital projects to pursue at our engineering and
operations (E&O) meetings and in additional budget and project meetings as necessary. Aspects of running the plant are discussed at the E&O meetings including financial issues in addition to the engineering and operational issues.
The joint plant owners vote on capital projects, which for approval require
majority of owners. Recordholder: Mike Johanson
Sponsor: Steve McDougal

PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 43
IPUC Data Request 43 Please provide all documentation for plant investments made at the Hayden Power Plant since 2013, between the Company and its operating partner showing
how the Company was engaged with its operating partner to minimize plant
investment costs. Please include any documentation justifying the need for an upgrade, documentation questioning the need for an upgrade, and any analysis comparing the cost and benefits of other alternatives considered.
Response to IPUC Data Request 43 The Company objects to the request for ALL documentation for every plant investment made since 2013 because it is vague and unduly burdensome. Without waiving this objection, pursuant to an agreed upon resolution with the staff of the
Idaho Public Utilities Commission the Company responds as follows:
Please refer to the Company’s response to IPUC Data Request 48.

Recordholder: Various Sponsor: To Be Determined
PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 44
IPUC Data Request 44 Please list every Hayden Power Plant capital project with a budget of $250,000 or more completed since 2013, that used internal resources (internal defined as any ownership partner) instead of an outside contractor. For each capital project listed,
please explain why internal resources were used instead of an outside contractor. Response to IPUC Data Request 44

Please refer to the Company’s response to IPUC Data Request 43. Recordholder: Various
Sponsor: To Be Determined

PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 45
IPUC Data Request 45 Please describe the methods used at the Hermiston Generating Plant to ensure capital investment projects were completed in a least-cost manner. Please include any plant specific guidelines and procedures documenting these methods.
Response to IPUC Data Request 45
Hermiston Generating Plant (HGP) is a joint owned facility with PacifiCorp’s
ownership being 50 percent (Perennial Power is the operator). For capital projects, HGP is required to obtain quotes from three qualified vendors. The vendors must be creditworthy, meet insurance requirements and have a proven track record of deliverables. Once the quotes are received, an
application must be made for the selection and approval of the vendor. The
application is reviewed by several departments (risk, legal, finance) and approved or disapproved according to an overall evaluation. If the vendor application is approved, legal will finalize a master purchase agreement to minimize risk.

For items such as replacement parts, the HGP utilizes the “least cost” approach as long as procured items are like in kind, have identical warranties and comparable lead times. In addition to the work done by the operator, PacifiCorp reviews capital projects
for necessity and cost, then votes accordingly. PacifiCorp works with Perennial
Power to discuss which capital projects to pursue at our engineering and operations (E&O) meetings and in additional budget and project meetings as necessary. Aspects of running the plant are discussed at the E&O meetings
including financial issues in addition to the engineering and operational issues.
The joint plant owners vote on capital projects, which for approval require majority of owners. Recordholder: Mike Johanson

Sponsor: Steve McDougal
PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 46
IPUC Data Request 46 Please provide all documentation for plant investments made at the Hermiston Generating Plant since 2013, between the Company and its operating partner
showing how the Company was engaged with its operating partner to minimize
plant investment costs. Please include any documentation justifying the need for an upgrade, documentation questioning the need for an upgrade, and any analysis comparing the cost and benefits of other alterative considered.
Response to IPUC Data Request 46 The Company objects to the request for ALL documentation for every plant investment made since 2013 because it is vague and unduly burdensome. Without waiving this objection, pursuant to an agreed upon resolution with the staff of the
Idaho Public Utilities Commission the Company responds as follows:
Please refer to the Company’s response to IPUC Data Request 48.

Recordholder: Various Sponsor: To Be Determined
PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 47
IPUC Data Request 47 Please list every Hermiston Generating Plant capital project with a budget of $250,000 or more completed since 2013 that used internal resources (internal defined as any ownership partner) instead of an outside contractor. For each of
capital project listed, please explain why internal resources were used instead of an outside contractor.
Response to IPUC Data Request 47
Please refer to the Company’s response to IPUC Data Request 46. Recordholder: Various

Sponsor: To Be Determined
PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 48
IPUC Data Request 48 Please provide the following documentation for each electric generating plant capital project with a budget of $1,000,000 or more completed since 2013 (where
requested information has not been provided, please explain why it was not
provided and how the Company assured the construction of the project was completed at least cost):
(a) Analysis of Need – a justification of need for each project and a cost/benefit
analysis comparing alternatives. (b) Project Plan: i. Initial project scope.
ii. Proposed budget.
iii. Proposed schedule. (c) Requests for proposals (RFP):

i. Project requirements. ii. Specifications. iii. Short list bidder scorecard. iv. RFP from winning bid.
(d) Project construction documentation including:
i. Construction contract. ii. Organizational chart.
iii. Scope document.
iv. Work breakdown structure. v. Baseline Schedule. vi. Monthly project status report(s). vii. Action items list(s). viii. Contractors change order request(s).

(e) Company project completion analysis: i. Lessons learned. ii. Budget-to-actual comparisons for overall project and by year. iii. Baseline schedule-to-actual schedule comparison. iv. For any actual costs differing from the budget amount by plus or minus five percent during a particular year please list and explain the reason(s) for the budget amount difference.
PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 48
Response to IPUC Data Request 48 Based on the resolution agreed to during discussions between representatives of PacifiCorp and the Idaho Public Utilities Commission (IPUC) staff regarding the
content, scope, and materiality level of IPUC Set 2, the parties agreed that the
Company would provide a list of generation, transmission, and distribution capital projects, of $5 million or greater (total company), that were transferred to electric plant in service during calendar years 2013 through 2020. The list of capital
projects is from PacifiCorp’s results of operations for calendar years 2013 through
2020. In addition, the Company will provide copies of the appropriation request documents for each of the capital projects included in the above referenced list. Based on the above information, the Company responds as follows: Please refer to Confidential Attachment IPUC 48-1 which provides the list of
capital projects as described above. Please refer to Confidential Attachment IPUC
48-2 which provides copies of APR documents for each of the capital projects included in the above referenced list. Two projects were not provided at this time but will be supplemented as soon as the documents are available.

Confidential information is provided subject to protection under IDAPA 31.01.01.067 and 31.01.01.233, the Idaho Public Utilities Commission’s Rules of Procedure No. 67 – Information Exempt from Public Review, and further subject to the Non-Disclosure Agreement (NDA) executed in this proceeding.

Recordholder: Various Sponsor: To Be Determined

PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 49
IPUC Data Request 49 Please provide the following documentation for each transmission or distribution capital project with a budget of $1,000,000 or more completed since 2013 (where requested information has not been provided, please explain why it was not
provided and how the Company assured the construction of the project was completed at least cost):
(a) Analysis of Need – a justification of need for each project and a cost/benefit
analysis comparing alternatives. (b) Project Plan: i. Initial project scope.
ii. Proposed budget.
iii. Proposed schedule. (c) Requests for proposals (RFP):

i. Project requirements. ii. Specifications. iii. Short list bidder scorecard. iv. RFP from winning bid.
(d) Project construction documentation including:
i. Construction contract. ii. Organizational chart.
iii. Scope document.
iv. Work breakdown structure. v. Baseline Schedule. vi. Monthly project status report(s). vii. Action items list(s). viii. Contractors change order request(s).

(e) Company project completion analysis: i. Lessons learned. ii. Budget-to-actual comparisons for overall project and by year.
iii. Baseline schedule-to-actual schedule comparison. iv. For any actual costs differing from the budget amount by plus or minus five percent during a particular year please list and explain the reason(s) for the budget amount difference.
PAC-E-21-07 / Rocky Mountain Power July 21, 2021 IPUC Data Request 49
Response to IPUC Data Request 49 Please refer to the Company’s response to IPUC Data Request 48.

Recordholder: Various Sponsor: To Be Determined