20170111AVU to Staff 1-6.pdf

Avista Corp.
1411 East Mission P.O. Box3727
Spokane. Washington 99220-0500
Telephone [phone]
J.iVISTJI"
Toll Free 800-727-9170
January 10, 2017
Idaho Public Utilities Commission
472 W. Washington St.
Boise, ID 83720-0074
Attn: Daphne Huang
Deputy Attorney General
Re: Production Request of the Commission Staff in Case No. AVU-G-16-03
Dear Ms. Huang,
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Enclosed on a separate CD and on paper, are copies of Avista's responses to IPUC Staffs
production requests in the above referenced docket. Included in this mailing is A vista's response
to production request Staff 001-006. The electronic versions of the responses were emailed on
01/10/17.
If there are any questions regarding the enclosed information, please contact Wendy Manskey at
[phone] or via e-mail at [e-mail]
Sincerely,
Wen Manskey
Rates Coordinator
Enclosures
CC (Email): IPUC (Holt)
JURISDICTION:
CASE NO.:
REQUESTER:
TYPE:
REQUEST NO.:
REQUEST:
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
IDAHO
A VU-G-16-03
IPUC
Production Request
Staff-01
DATE PREPARED:
WITNESS:
RESPONDER:
DEPARTMENT:
TELEPHONE:
01/12/2017
NIA
Tom Pardee
Natural Gas Resources
[phone]
Page 1 of the A vista 2016 Natural Gas IRP Appendix lists organizations and representatives that
participated in the 2016 Natural Gas IRP TAC meetings. Please provide the telephonic and in­
person attendance records for each of the TAC meetings, including attendee names and
corresponding organizations. Additionally, please provide copies of any notifications, flyers, or
publications sent to the public regarding the 2016 Natural Gas IRP.
RESPONSE:
Please see Staff_PR_Ol Attachment A for the attendees at each Technical Advisory Committee
(TAC) meeting during the 2016 Natural Gas IRP.
Throughout the planning phase of the 2016 IRP, the presentations and meeting locations were all
posted to the Avista Utilities website (www.avistautilities.com) under the "Inside Avista" section
link to "Resources and Transmission Services". More importantly there is contact information for
any individual or entity requesting to participate in this planning process.
Page 1 of 1
Avista 2016 Integrated Resource Plan -
Technical Advisory Group Meeting
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Page 1 of 7
Avista 2016 Integrated Resource Plan -
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Page 2 of 7
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Page 3 of 7
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Page 4 of 7
Avista 2016 Integrated Resource Plan -
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Page 5 of 7
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Page 6 of 7
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Page 7 of 7
JURISDICTION:
CASE NO.:
REQUESTER:
TYPE:
REQUEST NO.:
REQUEST:
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
IDAHO
A VU-G-16-03
IPUC
Production Request
Staff-02
DATE PREPARED:
WITNESS:
RESPONDER:
DEPARTMENT:
TELEPHONE:
01/12/2017
NIA
Tom Pardee
Natural Gas Resources
[phone]
On page 133 of the Avista 2016 Natural Gas IRP, the Company states: "Over the longer-term,
targeted conservation programs may provide a cumulative benefit that could offset potential
constraint areas and may be an effective strategy." Please describe any targeted conservation
programs that have been considered in Idaho. As part of the response, please explain how the
Company evaluates and measures the cost-effectiveness of these programs. If the Company has
not considered targeted conservation programs in Idaho, please explain why not and describe
plans for future consideration.
RESPONSE:
The Company has not offered targeted locational DSM programs in Idaho to date, primarily due
to difficulty in measuring individual projects on a complex interconnected system. The Demand
Side Management group will work closely with Gas Supply and Gas Engineering to determine
projects that are 5 -10 years and may fit within a pilot program. These projects will include
targeted marketing and "super" incentives to help determine the effectiveness of targeted
locational DSM offerings.
Page 1 oft
JURISDICTION:
CASE NO.:
REQUESTER:
TYPE:
REQUEST NO.:
REQUEST:
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
IDAHO
A VU-G-16-03
IPUC
Production Request
Staff-03
DATE PREPARED:
WITNESS:
RESPONDER:
DEPARTMENT:
TELEPHONE:
01/12/2017
NIA
Tom Pardee
Natural Gas Resources
[phone]
On page 46 of the Avista 2016 Natural Gas IRP, the Company states: "Since the benefits of
deferred capacity are a one-time cost, the benefits would be spread over the life of a typical
distribution upgrade (35 years) as an avoided payment. This component of avoided costs was not
included in this IRP and will be discussed with A vista's DSM Advisory Group as well as the TAC
to determine the correct approach for the 2018 IRP." Please explain why this component of the
avoided cost was not included in this IRP. Furthermore, please provide schedules for discussions
and meetings with the DSM Advisory Group and TAC where the topic of distribution avoided
costs will be addressed. If schedules have not been established, provide best estimates for when
discussions and meetings will occur.
RESPONSE:
The analysis for deferred distribution capacity was not complete in time to be included within the
2016 IRP. While specific schedules have not been formulated for the 2018 IRP, this item will
likely be covered at the Spring Advisory Group meeting and the first TAC meeting of the 2018
IRP, where conservation is presented and discussed.
Pagel of l
A VISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
JURISDICTION:
CASE NO.:
REQUESTER:
TYPE:
REQUEST NO.:
REQUEST:
IDAHO
AVU-G-16-03
IPUC
Production Request
Staff-04
DATE PREPARED:
WITNESS:
RESPONDER:
DEPARTMENT:
TELEPHONE:
01/12/2017
NIA
Tom Pardee
Natural Gas Resources
[phone]
On page 111 of the Avista 2016 Natural Gas IRP, the Company states that no supply resource
deficiencies exist under the Average Case or Expected Case scenarios within the 20-year
planning horizon. However, the Company shows that several distribution resource projects will
be required within the planning horizon. Please explain how the Company considered DSM as a
least-cost way to defer or avoid the distribution projects listed in Table 7 .1 of the Avista 2016
Natural Gas IRP, particularly when it did not include the value of deferred distribution capacity
in the avoided cost calculation.
RESPONSE:
The projects listed in table 7.1 have been identified as necessary distribution reinforcements to
maintain system capacity. Gas distribution load study analysis results have found capacity
constraints and the inability to maintain minimum pressures in each area (LaGrande, North
Spokane, Coeur d ' Alene, and Schweitzer Mountain Rd) under cold weather conditions. Although
DSM can reduce total demand, the effects of DSM on the specific geographic areas (listed in table
7.1) are either too little or negligible to defer or avoid any of the projects listed in Table 7 .1.
_,_ -Location 2018 2017 2018
La Grande High
Pressure $3,500,000
Reinforcement
North Spokane $2,000,000 Reinforcement
Coeur d'Alene High
Pressure $250,000 $4,000,000 $4,000,000
Reinforcement
Schweitzer
Mountain Rd High $1,500,000 Pressure
Reinforcement
*Details of project described in IRP as of August 2016
Page 1 of 1
JURISDICTION:
CASE NO.:
REQUESTER:
TYPE:
REQUEST NO.:
REQUEST:
A VISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
IDAHO DATE PREPARED: 01/12/2017
A VU-G-16-03 WITNESS: NIA
IPUC RESPONDER: Tom Pardee
Production Request DEPARTMENT: Natural Gas Resources
Staff-05 TELEPHONE: [phone]
Please provide a detailed description of the Coeur d'Alene High Pressure Reinforcement project
listed in Table 7 .1 to include why the project is needed, how much capacity will be added, what
alternatives the Company explored, and why this is the least-cost solution.
RESPONSE:
A Description of the Coeur d'Alene High Pressure Reinforcement project can be found on page
136 of the 2016 Natural Gas IRP. This project will reinforce the Coeur d'Alene distribution system
as well as greatly improve the Hayden Lake distribution system, which currently cannot maintain
adequate pressure during cold winter conditions. Approximately 17,200 feet of High Pressure
(HP) steel gas main and two district regulator stations will be designed in 2016 with construction
in 2017 and 2018.
This project is needed because on a 70 HDD, the eastern part of the Coeur d' Alene distribution
experiences low pressure. The Coeur d' Alene High Pressure Reinforcement will allow the system
to maintain necessary pressures up to an 82 HDD (design day conditions). Since the Williams
Northwest Pipeline's CDA Lateral is at capacity the Coeur d'Alene High Pressure Reinforcement
project will help shift existing load from that lateral to GTN-TransCanada's pipeline. Upon
completion of the project, the additional capacity of the high pressure reinforcement with two
proposed regulation stations added will be 428 Meth (82 HDD projected load + 20% growth
factor).
There were numerous alternatives explored for this project, including analysis of several
combinations of routes and pressure levels. This resulted in six proposals for engineering
evaluation and design considerations. Contracting with Williams NWP to add capacity to their
CDA Lateral is more costly and does not allow the flexibility to purchase gas from either pipeline
during off-peak times to maximize gas purchasing. Finally, contracting for additional capacity
from Williams NWP does not build any additional reliability into Avista's distribution system as
it does not bring in a second gas source (GTN) like the high pressure reinforcement does.
The Coeur d' Alene High Pressure Reinforcement project will consist of the least cost route
because of its maximum system pressure improvement, shortest route, and it provides the ability
to coordinate with local city road projects to reduce the impacts to the public and the cost of
construction.
Page 1 ofl
AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATION
JURISDICTION:
CASE NO.:
REQUESTER:
TYPE:
REQUEST NO.:
REQUEST:
IDAHO
A VU-G-16-03
IPUC
Production Request
Staff-06
DATE PREPARED:
WITNESS:
RESPONDER:
DEPARTMENT:
TELEPHONE:
01/12/2017
NIA
Tom Pardee
Natural Gas Resources
[phone]
Please explain differences in A vista's projections of customer growth, consumption, and demand.
For example on page 39, the Company projects customer growth of 1.1 %, but only predicts that
demand will grow at a rate of 0.36%. Please provide any relevant workpapers with formulae
intake.
RESPONSE:
Customer growth does not equate 1: 1 to demand growth. Customers are one aspect in calculating
demand, but there are various other assumptions that influence demand. In addition to customers,
the "achievable potential" measures of demand side management (DSM), along with a .015 price
elasticity adjustment are the contributing factors to the rate at which demand is forecasted to grow.
Table 1 below shows the varying assumptions between the Reference Case and Average Case.
Use per Customer
Prices
Price curve
Carbon Le islation ($/Ton)
3 yr Flat
No
Normal
Expected
None
3 yr Flat+
Price Elasticit
Yes
Normal
Expected
$9.89 -19.93
Using the Reference Case as a baseline, the chart contained in Staff PR 06 Attachment A
illustrates how demand is influenced by layering on the varying assumptions. Also depicted in the
chart is the direct effect on demand from the upward trajectory of DSM. Essentially, DSM
programs and price elasticity are the reasons growth in demand is largely offset across the customer
base.
Page 1 of 1
Dth
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
C
Reference Case and Average Case Demand vs. DSM and Elasticity
WA/ID
~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ y ~ ~ * @ ~ ~ ~ ~ ~ ~ ~ ~v ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ 0 ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ 0 ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~
-Reference Case WA/ID Demand
(Dth)
-DSM Impact on Demand -WA/ID (Dth)
Staff_PR_06 Attachment A.XLSX
Avg Case WA/ID Demand, including elasticity
(Dth)
-Elasticity Impact on Demand -WA/ID (Dth)
-Avg Case WA/ID Demand, including elasticity & DSM
(Dth)
lof 1