20150812AVU to Staff 39.docx

AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATIONJURISDICTION:IDAHODATE PREPARED:08/03/2015CASE NO.:AVU-E-15-05/AVU-G-15-01WITNESS:Bryan CoxREQUESTER:IPUCRESPONDER:Kenneth DillonTYPE:Production RequestDEPARTMENT:Transmission ServicesREQUEST NO.:Staff-039TELEPHONE:[phone]
REQUEST:
With respect to the ColumbiaGrid participation and cost increases (See Cox DI, pg. 6, line 7), please answer the following:
What caused the annual increases from the current contributions, and how are they determined?
Please describe how ColumbiaGrid implements data improvements to the Transmission Expansion Planning Policy Committee (TEPPC) Common Case and Base Case in the regional analyses. For example NTTG conducts a “round trip” analysis approach of PCM – Power Flow – PCM. Does ColumbiaGrid perform a similar analysis? If not, why not?
Are these regional planning data and modeling improvements provided to TEPPC to improve the TEPPC Common Case and WECC Base Cases? If not, what do ColumbiaGrid members need to do so that these improvements are effectively shared?
Please describe how the other regions implement improvements to the TEPPC Common Case and WECC base cases in their regional analyses. Are these improvements provided to WECC for use in future base cases? If not, are ColumbiaGrid interface members communicating on how all of the regions need to effectively share these improvements so that everyone can have access to better data?
How will the resulting regional and interregional plans evaluate reliability challenges? And, will WECC be asked to contribute anything to these efforts?
Please clarify whether the benefits of the transmission projects are included in the ColumbiaGrid analysis, or whether the analysis only evaluates a difference in cost. How does ColumbiaGrid quantify the benefits? Please explain.
How can the current ColumbiaGrid members ensure the regional and interregional FERC Order 1000 processes will produce a least-cost, least-risk interregional plan that also provides the highest benefits? Will the resulting interregional plan result in a cost-allocation framework that is also suitable for investment and ownership rights? Please explain.RESPONSE:
ColumbiaGrid is an independent, non-profit member corporation with staff and a three member board. ColumbiaGrid’s independent CEO and staff establish a draft budget for the corporation which the independent board approves prior to the start of the fiscal year. The operating planincludes increases in annual operating costs, such as leases, equipment, office space, software expenses, travel, and positions to be filled which were vacant during the 2014 test year due to retirements.
At the Company’s request, ColumbiaGrid provided the following information: Since late 2013, ColumbiaGrid has acquired a production cost model and has been working to integrate production cost modeling into its transmission expansion planning process.  However, ColumbiaGrid does not currently perform 'round trip' analyses between production cost analyses and power flow analyses.  Rather, ColumbiaGrid uses known generation patterns in performing its power flow analyses.  Further, the TEPPC ten-year production cost case may contain assumptions or system characteristics that are not consistent with those of ColumbiaGrid's transmission planning participants. ColumbiaGrid has utilized the a2010 backcastProduction Cost Simulation Base Cases, developed by the WECC TEPPC, as the starting point of its studies. In general, the following data improvements or validations are performed by ColumbiaGrid prior to conducting its production cost studies.BackCast: The goal of Back Cast is to ensure that the results from simulation can reasonably mimic historical behavior of the system. ColumbiaGrid conducts this study by comparing the results from Production Cost simulation using TEPPC Base Cases with historical data. If the comparisons show major discrepancies between the simulation results and actual data, ColumbiaGrid will attempt to identify the root cause and modify the base cases to ensure better alignment of the simulation results and the historical data.Validation: The objective of this task is to make sure that the modeling and in-service dates of major system components, such as generators, transmission lines, load, heat rates, are accurate according to the study assumptions. As part of this effort, ColumbiaGrid re-evaluates each major component of TEPPC Base Cases and will update the base cases as needed to ensure the accuracy of the models.
The Company cannot speak directly to the manner in which ColumbiaGrid provides data and modeling revisions to TEPPC and WECC; however it is the Company’s understanding that ColumbiaGrid shares all of its base case improvement work with TEPPC and the System Review Work Group (“SRWG”) at WECC.
The Company cannot speak to the manner in which other regions provide improvements to the WECC for future base case improvements; however the Company is not aware of any issues with respect to the lack of accurate or updated modeling data in WECC base cases.
The Amended and Restated FERC Order 1000 Functional Agreement (“Order 1000 Functional Agreement”), provided in response to Request No. 41, covers both intra-regional and inter-regional projects, including projects that are reliability based in nature. Additionally, the ColumbiaGrid Planning and Expansion Functional Agreement (PEFA), which is filed at FERC on behalf of the jurisdictional transmission provider members of ColumbiaGrid as ColumbiaGrid Rate Schedule No.1, provides for the coordinated planning of reliability projects. Reliability issues are evaluated by transmission providers, in coordinated fashion, consistent with established reliability planning criteria. WECC, in its NERC-delegated role as the Regional Entity, promulgates the reliability criteria pursuant to which transmission providers in the WECC region perform their intra-regional and inter-regional studies. Accordingly, ColumbiaGrid’s Biennial Plan is prepared in accordance with the requirements of the Order 1000 Functional Agreement and the PEFA, consistent with established reliability criteria.
For projects for which an Order 1000 cost allocation is sought, the Order 1000 Functional Agreement requires ColumbiaGrid to identify any Order 1000 Beneficiaries and project the Order 1000 Benefits of each such beneficiary as a direct result of each Order 1000 Project for which it applies the Order 1000 Cost Allocation Methodology. Section 6.2 of Appendix A of the Order 1000 Functional Agreement addresses how Order 1000 Benefits are to be calculated.
In Order No. 1000, the FERC explained that its reforms “work together to ensure that public utility transmission providers in every transmission planning region, in consultation with stakeholders, evaluate proposed alternative solutions at the regional level that may resolve the region’s needs more efficiently or cost-effectively than solutions identified in the local transmission plans of individual public utility transmission providers.” The Order No. 1000 Functional Agreement facilitates the Company’s compliance with the requirements of Order No. 1000and is intended to produce both regional and interregional plansthat efficiently and cost-effectively resolve needs.