20041119Comments.pdf

, ;-
i C I ;.. -
' ,- '
, U L. '. L f):-
-'-_.
BARTON l. KLINE , ISB # 1526
Idaho Power Company
1221 West Idaho Street
O. Box 70
Boise, Idaho 83707
Telephone: [phone]
FAX Telephone: [phone]
1 !
r""'-
..!
ZDDJi !\iOV 1 9 Pfl '4: 2 :
. '" - . :..-" "- , ; ,- , '---'
uTIL! liES COt,jt"iiSSIOf'i
Attorney for Idaho Power Company
BEFORE THE IDAHO PUBLIC UTiliTIES COMMISSION
IN THE MATTER OF THE REVISION AND
UPDATED CALCULATION OF THE
AVOIDED COST RATES FOR A VISTA
CORPORATION DBA A VISTA UTlllTI ES
FOR IDAHO POWER COMPANY AND FOR
PACIFICORP DBA UTAH POWER AND
LIGHT COMPANY.
CASE NOS. A VU-04-
I PC-04-
P AC-O4-
COMMENTS OF IDAHO
POWER COMPANY
On November 4 , 2004, in Order No. 29628, the Commission issued a
Notice of Avoided Cost Recalculations which included proposed avoided cost rates for
Idaho Power Company ("Idaho Power" or "Company
).
Also on November 4 , the Staff
of the Idaho Public Utilities Commission ("Staff") provided to Idaho Power additional
documentation showing how the proposed avoided cost rates attached to Order No.
29628 had been computed by Staff. Idaho Power has reviewed the proposed rates
attached to Order No. 29628 and the material provided by Staff. Based on that review
Idaho Power has the following comments.
IDAHO POWER COMPANY'S COMMENTS , Page
Model
Idaho Power concurs that the basic model used by the Staff to compute
the proposed avoided cost rates attached to Order No. 29628 is consistent with the
model adopted by the Commission in Order 29124.
Model Inputs
Natural Gas Forecasts. Idaho Power concurs that Staff's use of the
Natural Gas Price Forecasts from the Northwest Power and Conservation Council
(NPCC) Draft 5th Power Plan dated September 29 , 2004 is consistent with Order 29124.
Cost of Call1i!!!
Utility Weiqhted Cost of Cagjill!
Previously 9.199 % - Revised to 7.852 %
~ital Carrvinq Chargg
Previously 12.424 % - Revised to 11.517 %
Both of these revisions accurately reflect the values from the recent Idaho
Power general rate case. Inputting these values into the avoided cost model is
appropriate.
General Inflation Rate
At the top of the page titled "Analysis of Northwest Power and
Conservation Council (NPCC) Natural Gas Price Forecasts , September 29 , 2004 Draft
th Power Plan" there is an input titled "General Inflation rate." This General Inflation
IDAHO POWER COMPANY'S COMMENTS, Page 2
Rate is used in the calculation of the average natural gas forecasted price contained
within this page.
This inflation rate was set in IPUC Order 29124 at 2./0 (Page 12 and 13
of IPUC Order 29124). Order No. 29124 references the source of this inflation rate to
be the "DOE/EIA Annual Energy Outlook 2002 - general inflation rate
" ("
General
nflation Rate
Idaho Power does not believe it is appropriate to revise the General
Inflation Rate in this proceeding and requests that the Commission revise the proposed
avoided cost rates attached to Order No. 29628 to reflect a General Inflation Rate of
/0 as specified in Order 29124. Idaho Power believes it is appropriate to retain the
existing 2./0 General Inflation Rate for the following reasons:
(a)Order 29124 provided guidance that at the time a new natural gas
price forecast was published , avoided costs would be revised to reflect the new natural
gas price forecast. It did not contemplate or state that other values (General Inflation
Rate) would be revised at these times.
(b)In the last Order revising the avoided costs (Order No. 29391), the
inflation rate remained unchanged at 2./0 even though the actual value within the
Energy Outlook report changed from 2./0 to 2.5 0/0.
Idaho Power has discussed its concerns with changing the inflation rate
with Staff and bye-mail dated November 18 , 2004. Staff advised the parties that it
agreed with Idaho Power on this point. Staff attached revised proposed avoided cost
rates to its November 18,2004 e-mail. Based on its preliminary review of the revised
IDAHO POWER COMPANY'S COMMENTS , Page 3
rates attached to the e-mail , Idaho Power believes these revised rates are accurate and
in conformity with Order No. 29124.
Summary
Idaho Power believes the revised proposed avoided cost rates reflecting
the 2./0 General Inflation Rate that were attached to the Staff's November 18 , 2004 e-
mail are accurate and should be adopted as Idaho Power s published avoided cost
rates in accordance with Order No. 29124.
DATED this 19th day of November, 2004.
BART N L. KLINE
Attorney for Idaho Power Company
IDAHO POWER COMPANY'S COMMENTS , Page 4
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 19th day of November, 2004 , I served a
true and correct copy of the within and foregoing IDAHO POWER COMPANY'
COMMENTS upon the following named parties by the method indicated below, and
addressed to the following:
Blair Strong
Paine, Hamblen, et al
717 W. Sprague Ave., Suite 1200
Spokane , WA 99201-3505
Doug Young
Avista Utilities
1411 E. Mission
O. Box 3727
Spokane, W A 99220-3727
James C. Paine
James Fell
Stoel Rives LLP
900 S.W. Fifth Avenue , Suite 2600
Portland , OR 97204
Mark Widmer
PacifiCorp
825 N.E. Multnomah Street
Portland , OR 97232
CERTIFICATE OF SERVICE
Hand Delivered
S. Mail
Overnight Mail
FAX
Hand Delivered
S. Mail
Overnight Mail
FAX
Hand Delivered
S. Mail
Overnight Mail
FAX
Hand Delivered
S. Mail
Overnight Mail
FAX
BARTON L. KLINE