20100309Application.pdf

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2010 HAR -9 AM II: 27
STATE OF IDAHO ¡"";
OFFICE OF THE ATTORNEY GENERAL
LAWRENCE G. WASDEN
March 9,2010
Avista Corporation
Blair Strong
Paine, Hamblen, et al
717 W. Sprague Avenue, Suite 1200
Spokane, WA 99201-3505
Clint Kalich
A vista Utilities
1411 E. Mission
PO Box 3727
Spokane, WA 99220-3727
Michael Andrea
A vista Utilties
1411 E. Mission
PO Box 3727
Spokane, WA 99220-3727
Rocky Mountain Power
Mark Moench
Daniel Solander
Ted Weston
PacifiCorp dba Rocky Mountain Power
One Utah Center
201 S. Main Street, Suite 2300
Salt Lake City, UT 84111
Greg Duvall
Hui Shu
Laren Hale
PacifiCorp dba Rocky Mountain Power
825 NE Multnomah Street
Portland, OR 97232
Idaho Power Company
Barton L. Kline
Idaho Power Company
PO Box 70
Boise, ID 83707-007
Randy Allphin
Idaho Power Company
POBox 70
Boise, ID 83707-0070
RE: Case No. GNR-E-IO-Ol
Pursuant to the Public Utilty Regulatory Policies Act of 1978 (PURP A) and the implementing
regulations of the Federal Energy Regulatory Commission (FERC), the Idaho Public Utilties
Commission (Commission) has approved a Surogate A voided Resource (SAR) methodology for
calculation of the avoided cost rates paid to PURP A qualifying cogeneration and small power
Contracts & Administrative Law Division, Idaho Public Utilties Commission
P.O. Box 83720, Boise, Idaho 83720-0074, Telephone: [phone], FAX: [phone], E-mail: Ipuc~puc.state.id.us
Located at 472 West Washington St., Boise, Idaho 83702
March 9, 2010
Page 2
production facilities (QFs) by Idaho Power Company, Àvista and PacifiCorp. Avoided cost rates
are the purchase price paid to QFs for purchases of QF capacity and energy.
One of the key input variables in the computation of avoided cost rates is a long-term natural gas
price forecast. In accordance with the methodology approved in Order No. 29124, the medium
natural gas price forecast of the Northwest Power and Conservation Council (NPCC; Council) is
to be used as the basis for computing avoided cost rates. In Order No. 29124, the Commission
also found that the release of a new fuel price forecast by the Councilor the Council's general
advisory committees automatically triggers a recalculation of the published avoided cost rates.
A new Council natural gas price forecast was approved on March 2, 2010, in conjunction with
the Council's approval and release of its Sixth Power Plan (Plan). The forecast was posted on
the Council's website on March 8, 2010. The forecast is Appendix A to the Plan. A copy of the
medium natural gas price forecast contained in Appendix A to the Plan is attached. In
accordance with the approved methodology, east-side delivered prices are to be used for avoided
cost computations.
Commission Staff has recomputed avoided cost rates using the Council's most recent gas price
forecast. Accompanying this letter are sheets showing the results from recomputation of the
avoided cost rates using the new Council natural gas price forecast that was posted on March 8,
2010. If after reviewing the revised rates, you accept them as accurate please indicate your
approval by letter (or other fiing) directed to the Commission in the reserved case docket
numbers identified above. The case heading for the adjustment, Case No, GNR-E-1O-01, wil
read as follows:
IN THE MATTER OF THE ADJUSTMENT OF AVOIDED COST RATES FOR
NEW PURPA CONTRACTS FOR AVISTA CORPORATION DBA AVISTA
UTILITIES, IDAHO POWER COMPANY, AND PACIFICORP DBA ROCKY
MOUNTAIN POWER.
Please file your respective responses with the Commission on or prior to March 12,2010.
Than you for your cooperation. Please feel free to contact me or Rick Sterling if you have any
questions.
~~Scott Woodbur ~
Deputy Attorney General t
Enclosures
L:GNR-E-IO-01 sw rs
Table Al-l: Natural Gas Prices at Key Hubs and Northwest Generators
2006$/MMBtu
Medium Case
2005 7.95 6.98 7.08 7.70 7.58
2006 6.72 5.84 5.95 6.56 6.42
2007 6.53 5.67 5.78 6.38 6.24
2008 8.12 7.08 7.72 8.41 7.68
2009 3.95 3.35 3.94 4.59 3.91
2010 4.62 3.95 4.54 5.28 4.56
2011 4.90 4.20 4.80 5.61 4.86
2012 5.20 4.47 5.07 5.90 5.19
2013 5.52 4.76 5.36 6.20 5.48
2014 5.86 5.06 5.67 6.52 5.79
2015 6.22 5.38 6.00 6.85 6.11
2016 6.32 5.48 6.09 6.96 6.22
2017 6.43 5.57 6.19 7.06 6.32
2018 6.54 5.67 6.29 7.16 6.44
2019 6.65 5.77 6.39 7.27 6.54
2020 6.77 5.87 6.50 7.38 6.64
2021 6.93 6.02 6.64 7.53 6.79
2022 7.09 6.16 6.79 7.68 6.94
2023 7.25 6.31 6.94 7.83 7.09
2024 7.42 6.46 7.09 7.99 7.25
2025 7.60 6.62 7.25 8.16 7.41
2026 7.70 6.71 7.35 8.26 7.51
2027 7.81 6.81 7.45 8.36 7.61
2028 7.92 6.91 7.55 8.47 7.71
2029 8.03 7.01 7.65 8.57 7.82
2030 8.15 7.11 7.75 8.68 7.92
Al-19
PACIFICORP
AVOIDED COST RATES FOR NON-FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
Draft
$/MWh
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2010 2011 2012 2013 2014 2015 YEAR RATES
1 56.85 60.24 63.97 67.51 71.32 75.40 2010 56.85
2 58.48 62.03 65.67 69.34 73.28 76.53 2011 60.24
3 60.17 63.71 67.40 71.20 74.66 77.62 2012 63.97
4 61.79 65.39 69.17 72.65 75.85 78.72 2013 67.51
5 63.40 67.09 70.63 73.91 76.99 79.79 2014 71.32
6 65.03 68.54 71.91 75.08 78.08 80.85 2015 75.40
7 66.44 69.82 73.09 76.19 79.14 81.94 2016 77.76
8 67.71 71.01 74.21 7725 80.21 83.04 2017 80.07
9 68.89 72.12 75.27 78.31 81.29 84.15 2018 82.58
10 69.99 73.17 76.32 79.37 82.36 85.26 2019 85.05
11 71.04 74.21 7735 80.42 83.43 86.37 2020 87.61
12 72.05 75.22 78.37 81.45 84.50 87.44 2021 90.63
13 73.05 76.22 79.38 82.48 85.53 88.47 2022 93.78
14 74.02 77.20 80.38 83.48 86.52 89.48 2023 97.05
15 74.97 78.17 81.34 84.44 87.49 90.45 2024 100.44
16 75.91 79.10 82.26 85.37 88.42 91.40 2025 103.98
17 76.80 79.99 83.16 86.27 89.33 92.36 2026 106.98
18 77.67 80.86 84.03 87.14 90.25 93.30 2027 110.07
19 78.51 81.70 84.87 88.02 91.15 94.23 2028 113.26
20 79.31 82.51 85.71 88.88 92.03 95.13 2029 116.56
2030 119.95
2031 124.51
2032 128.50
2033 132.64
2034 136.92
2035 141.35
Note: (1) The rates shown in this table have been computed using the Northwest Power and Conservation Council's Fuel Price Forecast
contained in its Sixth Power Plan approved on February 10, 2010. See page A1-19, East-Side Delivered prices. (Reference Order No.
30480). (2) The rates shown in this table have been computed using the weighted average cost of capital from PacifiCorp's most recent
general rate case. (See Order No. 30482).
PACIFICORP
AVOIDED COST RATES FOR FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
Draft
$/MWh
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2010 2011 2012 2013 2014 2015 YEAR RATES
1 21.85 22.17 22.51 22.85 23.19 23.54 2010 21.85
2 22.00 22.33 22.67 23.01 23.36 23.71 2011 22.17
3 22.16 22.49 22.83 23.17 23.52 23.88 2012 22.51
4 22.31 22.65 22.99 23.33 23.68 24.04 2013 22.85
5 22.46 22.80 23.14 23.49 23.84 24.20 2014 23.19
6 22.61 22.95 23.29 23.64 24.00 24.36 2015 23.54
7 22.75 23.09 23.44 23.79 24.15 24.51 2016 23.89
8 22.89 23.23 23.58 23.94 24.30 24.66 2017 24.25
9 23.03 23.37 23.72 24.08 24.44 24.81 2018 24.62
10 23.16 23.51 23.86 24.22 24.59 24.96 2019 24.99
11 23.29 23.64 24.00 24.36 24.73 25.10 2020 25.37
12 23.42 23.77 24.13 24.49 24.86 25.24 2021 25.75
13 23.54 23.90 24.26 24.62 24.99 25.37 2022 26.14
14 23.66 24.02 24.38 24.75 25.12 25.50 2023 26.53
15 23.78 24.14 24.50 24.87 25.25 25.63 2024 26.93
16 23.90 24.26 24.62 24.99 25.37 25.75 2025 27.34
17 24.01 24.37 24.74 25.11 25.49 25.87 2026 27.75
18 24.12 24.48 24.85 25.22 25.60 25.99 2027 28.17
19 24.22 24.59 24.96 25.33 25.72 26.10 2028 28.60
20 24.32 24.69 25.06 25.4 25.82 26.21 2029 29.03
2030 29.47
2031 29.92
2032 30.37
2033 30.83
2034 31.30
2035 31.77
EFFECTIVE DATE ADJUSTABLE COMPONENT
Draft 35.01
The total avoided cost rate in each year is the sum of the adjustable component and the fixed component from either of the tables abo e.
Example 1. A 20-year levelized contract with a 2010 on-line date would receive the following rates:
Years
1
2-20
Rate
24.32 + 35.01
24.32 + Adjustable component in each year
Example 2. A 4-year non-Ievelized contract with a 2010 on-line date would receive the following rates:
Years
1
2
3
4
Rate
21.85 + 35.01
22.17 + Adjustable component in year 2011
22.51 + Adjustable component in year 2012
22.85 + Adjustable component in year 2013
Note: (1) The rates shown in this table have been computed using the Northwest Power and Conservation Council's Fuel Price Forecast
contained in its Sixth Power Plan approved on February 10, 2010. See page A1-19, East-Side Delivered prices. (Reference Order No.
30480). (2) The rates shown in this table have been computed using the weighted average cost of capital from PacifiCorp's most recent
general rate case. (See Order No. 30482).
IDAHO POWER COMPANY
AVOIDED COST RATES FOR NON-FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
Draft
$/MWh
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2010 2011 2012 2013 2014 2015 YEAR RATES
1 56.67 60.06 63.78 67.32 71.13 75.21 2010 56.67
2 58.30 61.85 65.48 69.15 73.09 76.34 2011 60.06
3 59.99 63.53 67.22 71.01 74.46 77.43 2012 63.78
4 61.61 65.21 68.99 72.46 75.66 78.52 2013 67.32
5 63.23 66.91 70.44 73.72 76.80 79.60 2014 71.13
6 64.85 68.36 71.72 74.90 77.89 80.66 2015 75.21
7 66.27 69.64 72.91 76.01 78.95 81.5 2016 77.56
8 67.54 70.83 74.03 7707 80.03 82.85 2017 79.87
9 68.72 71.94 75.09 78.13 81.0 83.96 2018 82.38
10 69.82 73.00 76.14 79.19 82.18 85.07 2019 84.85
11 70.87 74.04 77.18 80.24 83.25 86.19 2020 87.40
12 71.89 75.06 78.20 81.28 84.32 87.26 2021 90.42
13 7289 76.06 79.21 82.31 85.35 88.30 2022 93.57
14 73.86 7704 80.21 83.31 86.35 89.31 2023 96.83
15 74.82 78.01 81.8 84.27 87.32 90.29 2024 100.23
16 75.76 78.95 82.11 85.21 88.26 91.24 2025 103.76
17 76.66 79.85 83.01 86.11 89.18 92.20 2026 106.75
18 77.53 80.72 83.88 87.00 90.10 93.15 2027 109.85
19 78.37 81.56 84.73 87.88 91.00 94.08 2028 113.03
20 79.19 82.38 85.58 88.74 91.89 94.99 2029 116.32
2030 119.71
2031 124.27
2032 128.26
2033 132.39
2034 136.67
2035 141.10
Note: The rates shown in this table have been computed using the Northwest Power and Conservation Council's Fuel Price Forecast
contained in its Sixth Power Plan approved on February 10, 2010. See page A1-19, East-Side Delivered prices. (Reference Order No.
30480). These rates also reflect a change in Idaho Powets weighted cost of capital as a result of Order No. 30722 in the Company's
2008 general rate case.
IDAHO POWER COMPANY
AVOIDED COST RATES FOR FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
Draft
$/MWh
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2010 2011 2012 2013 2014 2015 YEAR RATES
1 21.67 21.99 22.32 22.66 23.00 23.35 2010 21.67
2 21.82 22.15 22.48 22.82 23.17 23.51 2011 21.99
3 21.98 22.31 22.64 22.98 23.33 23.68 2012 22.32
4 22.13 22.46 22.80 23.14 23.49 23.84 2013 22.66
5 22.28 22.61 22.95 23.30 23.65 24.00 2014 23.00
6 22.42 22.76 23.10 23.45 23.80 24.16 2015 23.35
7 22.56 22.90 23.25 23.60 23.95 24.31 2016 23.70
8 22.70 23.04 23.39 23.74 24.10 24.47 2017 24.06
9 22.84 23.18 23.53 23.89 24.25 24.61 2018 24.42
10 22.97 23.32 23.67 24.03 24.39 24.76 2019 24.79
11 23.10 23.45 23.80 24.16 24.53 24.90 2020 25.16
12 23.23 23.58 23.93 24.30 24.66 25.03 2021 25.54
13 23.35 23.71 24.06 24.43 24.79 25.17 2022 25.93
14 23.47 23.83 24.19 24.55 24.92 25.30 2023 26.32
15 23.59 23.95 24.31 24.67 25.05 25.43 2024 26.71
16 23.71 24.06 24.43 24.79 25.17 25.55 2025 27.12
17 23.82 24.18 24.54 24.91 25.29 25.67 2026 27.53
18 23.93 24.29 24.65 25.02 25.40 25.79 2027 27.94
19 24.03 24.39 24.76 25.14 25.51 25.90 2028 28.37
20 24.13 24.50 24.87 25.24 25.62 26.01 2029 28.80
2030 29.23
2031 29.68
2032 30.13
2033 30.58
2034 31.05
2035 31.52
EFFECTIVE DATE ADJUSTABLE COMPONENT
Draft 35.01
The total avoided cost rate in each year is the sum of the adjustable component and the fixed component from either of the tables
above.
Example 1. A 20-year levelized contract with a 2010 on-line date would receive the following rates:
Years
1
2-20
Rate
24.13 + 35.01
24.13 + Adjustable component in each year
Example 2. A 4-year non-Ievelized contract with a 2010 on-line date would receive the following rates:
Years
1
2
3
4
Rate
21.67 + 35.01
21.99 + Adjustable component in year 2011
22.32 + Adjustable component in year 2012
22.66 + Adjustable component in year 2013
Note: The rates shown in this table have been computed using the Northwest Power and Conservation Council's Fuel Price Forecast
contained in its Sixth Power Plan approved on February 10, 2010. See page A1-19, East-Side Delivered prices. (Reference Order No.
30480). These rates also reflect a change in Idaho Power's weighted cost of capital as a result of Order No. 30722 in the Company's
2008 general rate case.
AVISTA
AVOIDED COST RATES FOR NON-FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
Draft
$/MWh
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2010 2011 2012 2013 2014 2015 YEAR RATES
1 56.94 60.32 64.06 67.60 71.41 75.50 2010 56.94
2 58.56 62.11 65.76 69.43 73.37 76.63 2011 60.32
3 60.25 63.80 67.49 71.29 74.74 77.71 2012 64.06
4 61.87 65.47 69.25 72.73 75.94 78.80 2013 67.60
5 63.47 67.16 70.70 73.98 7707 79.87 2014 71.41
6 65.09 68.60 71.97 75.15 78.16 80.93 2015 75.50
7 66.50 69.87 73.15 76.26 79.21 82.01 2016 77.85
8 67.76 7105 74.26 77.31 80.27 83.10 2017 80.16
9 68.92 72.16 75.31 78.36 81.34 84.20 2018 82.68
10 70.02 73.20 76.35 79.40 82.40 85.30 2019 85.15
11 71.05 74.22 77.37 80.44 83.46 86.40 2020 87.71
12 7205 75.23 78.38 81.47 84.51 87.45 2021 90.73
13 73.03 76.21 79.37 82.48 85.52 88.47 2022 93.88
14 73.99 77.18 80.36 83.46 86.50 89.46 2023 97.15
15 74.93 78.13 81.0 84.40 87.45 90.42 2024 100.55
16 75.84 79.04 82.21 85.31 88.37 91.35 2025 104.08
17 76.72 79.92 83.09 86.20 89.26 92.29 2026 107.09
18 77.57 80.76 83.94 87.05 90.16 93.21 2027 110.18
19 78.39 81.58 84.76 87.91 91.04 94.11 2028 113.37
20 79.17 82.37 85.58 88.75 91.89 94.99 2029 116.67
2030 120.06
2031 124.62
2032 128.62
2033 132.76
2034 137.04
2035 141.48
Note: The rates shown in this table have been computed using the Northwest Power and Conservation Council's Fuel Price Forecast
contained in its Sixth Power Plan approved on February 10, 2010. See page A1-19, East-Side Delivered prices. (Reference Order No.
30480).
AVISTA
AVOIDED COST RATES FOR FUELED PROJECTS
SMALLER THAN TEN MEGAWATTS
Draft
$/MWh
ON-LINE YEAR
CONTRACT NON-LEVELIZED
2010 2011 2012 2013 2014 2015 YEAR RATES
1 21.93 22.26 22.60 22.94 23.28 23.63 2010 21.93
2 22.09 22.42 22.76 23.10 23.45 23.80 2011 22.26
3 22.24 22.58 22.92 23.26 23.61 23.97 2012 22.60
4 22.40 22.73 23.07 23.42 23.77 24.13 2013 22.94
5 22.55 22.88 23.23 23.58 23.93 24.29 2014 23.28
6 22.69 23.03 23.38 23.73 24.09 24.45 2015 23.63
7 22.83 23.18 23.53 23.88 24.24 24.61 2016 23.99
8 22.97 23.32 23.67 24.03 24.39 24.76 2017 24.35
9 23.11 23.46 23.81 24.17 24.53 24.90 2018 24.71
10 23.24 23.59 23.95 24.31 24.67 25.05 2019 25.09
11 23.37 23.72 24.08 24.44 24.81 25.19 2020 25.46
12 23.50 23.85 24.21 24.58 24.95 25.32 2021 25.85
13 23.62 23.98 24.34 24.70 25.08 25.46 2022 26.24
14 23.74 24.10 24.46 24.83 25.20 25.58 2023 26.63
15 23.86 24.22 24.58 24.95 25.33 25.71 2024 27.04
16 23.97 24.33 24.70 25.07 25.45 25.83 2025 27.45
17 24.08 24.44 24.81 25.19 25.56 25.95 2026 27.86
18 24.19 24.55 24.92 25.30 25.68 26.07 2027 28.28
19 24.29 24.66 25.03 25.40 25.79 26.18 2028 28.71
20 24.39 24.76 25.13 25.51 25.89 26.28 2029 29.14
2030 29.58
2031 30.03
2032 30.49
2033 30.95
2034 31.42
2035 31.89
EFFECTIVE DATE ADJUSTABLE COMPONENT
Draft 35.01
The total avoided cost rate in each year is the sum of the adjustable component and the fixed component from either of the tables
above.
Example 1. A 20-year levelized contract with a 2010 on-line date would receive the following rates:
Years
1
2-20
Rate
24.39 + 35.01
24.39 + Adjustable component in each year
Example 2. A 4-year non-Ievelized contract with a 2010 on-line date would receive the following rates:
Years
1
2
3
4
Rate
21.93 + 35.01
22.26 + Adjustable component in year 2011
22.60 + Adjustable component in year 2012
22.94 + Adjustable component in year 2013
Note: The rates shown in this table have been computed using the Northwest Power and Conservation Councils Fuel Price Forecast
contained in its Sixth Power Plan approved on February 10, 2010. See page A 1-19, East-Side Delivered prices. (Reference Order No.
30480).