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An IDACORP Company
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LISA D. NORDSTROM
Lead Counsel
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April 26, 2013
VIA HAND DELIVERY
Jean D. Jewell, Secretary
Idaho Public Utilities Commission
472 West Washington Street
Boise, Idaho 83702
Re: Case No. IPC-E-1 3-09
Glanbia Foods, Inc.'s Petition - Idaho Power Company's Answer
Dear Ms. Jewell:
Enclosed for filing in the above matter are an original and seven (7) copies of Idaho
Power Company's Answer.
Sincerely,
Lisa D. Nordstrom
LDN :csb
Enclosures
1221 W. Idaho St. (83702)
P.O. Box 70
Boise, ID 83707
LISA D. NORDSTROM (ISB No. 5733)
JULIA A. HILTON (ISB No. 7740)
Idaho Power Company
1221 West Idaho Street (83702)
P.O. Box 70
Boise, Idaho 83707
Telephone: (208) 388-5825
Facsimile: (208) 388-6936
Inordstromidahopower.com
ihiItonidahopower.com
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7 71
Attorneys for Idaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF GLANBIA FOODS, )
INC. FOR APPROVAL OF AN ) Case No. IPC-E-13-09
ALLOWANCE PURSUANT TO IDAHO )
POWER COMPANY'S RULE H LINE ) ANSWER
EXTENSION TARIFF. )
Respondent, Idaho Power Company ("Idaho Power" or "Company"), hereby
submits its Answer to Glanbia Foods, Inc.'s ("Glanbia") Petition for Approval of an
Allowance Pursuant to Idaho Power's Rule H ("Petition") in the above-entitled case as
follows:
I. FACTUAL BACKGROUND
Glanbia is a Schedule 19 Large Power ("Schedule 19)1 Primary Service
customer of Idaho Power taking approximately nine megawatts ("MW") of service from a
distribution feeder originating from the Company's Toponis substation near Gooding,
1 No. 29, Tariff No. 101, First Revised Sheet No. 19-1 states, "Service under this
Schedule is . . . mandatory for Customers who register a metered Demand of 1,000 kW or more per
Billing Period for three or more Billing Periods during the most recent 12 consecutive Billing Periods."
2 A defined in Rule B, "Primary Service is service taken at 12.5 kilovolts (kV) to 34.5 kV."
ANSWER-1
Idaho. On July 25, 2012, Idaho Power received a request from Glanbia to serve an
additional load of approximately seven MW at its Gooding facility. As with all requests
to serve a new or increased large load, the Company analyzed its existing facilities to
determine if facilities of adequate capacity were available to supply the request.
The Company's first step in evaluating a large load request such as this is to
perform a Feasibility Study. The Feasibility Study identifies any system impacts and
upgrades to the Company's system that are necessary to serve the additional load. In
addition, the Feasibility Study also gives the customer high level cost estimates for
various options when applicable. The Feasibility Study for this request was completed
and presented to Glanbia on August 9, 2012, and is included as Attachment I to this
Answer. During the study, the Company determined that the existing facilities would be
unable to accommodate the increase in load.
Two options were identified to accommodate Glanbia's request. The first option
was to upgrade the Toponis station transformer and the existing distribution to the
Glanbia facility with a conceptual-level cost estimate of $5.7 million. The second option
was to build a new 20-30 megavolt-ampere ("MVA") substation at the Glanbia site that
would be served by a new 10 mile 138 kilovolt ("kV") transmission line with a
conceptual-level cost estimate of $6.3 million to $11.9 million, depending on the desired
substation MVA capacity and level of reliability.
After its receipt of the Feasibility Study, Glanbia paid the necessary fees and
authorized the Company to move forward with a Facility Study. The Facility Study is a
more detailed review of the design and construction of the project, which provides more
detailed cost and schedule estimates. As a result of Glanbia's desire for enhanced
reliability, Glanbia and Idaho Power mutually decided that the Facility Study would focus
ANSWER-2
only on the second option of providing a new substation at the Glanbia site to be served
by a new 10 mile 138 kV transmission line.
While the Facility Study was being prepared, various conversations took place
between the Company and Glanbia. At Glanbia's request, Idaho Power and Glanbia
met on October 18, 2012. Glanbia requested that the Company consider two possible
alternatives proposed by Glanbia as a potential means to mitigate the costs of the
facilities upgrade required to serve Glanbia's additional load. Glanbia suggested that it
might receive a credit for the reduction in its loss factor because, under this proposal,
Glanbia could take service at the transmission voltage level instead of taking service at
the distribution voltage level. Second, Glanbia suggested that by vacating existing
facilities, it would create "available capacity" that the Company could use elsewhere,
and therefore Glanbia could receive a credit. The Company committed to examining
both of Glanbia's proposed options.
The Company examined not only the alternatives proposed by Glanbia, but also
considered two additional possible options to mitigate the cost of the expansion. In a
letter to Glanbia dated November 9, 2012, the Company summarized its consideration
of each of the proposed options and the Company's response.3 The Company found
that three of the four options were not viable options for cost mitigation; however, a
Glanbia self-build option was proposed by the Company as a potentially viable option
for Glanbia to consider. This November 9, 2012, letter was accompanied by the
completed Facility Study Report, also dated November 9, 2012, which Glanbia included
with its Petition as Exhibit A, with an estimated cost of the project of $9.0 million.
Letter dated November 9, 2012, from Idaho Power Regulatory Projects Manager Michael
Youngblood to Glanbia's Executive Vice President John Mutchier is included as Attachment 2 'to this
Answer.
ANSWER-3
On November 27, 2012, the Company sent a revised Facility Study Report to
Glanbia. Only two revisions were made to the initial report. The first was a $652,203
reduction in the 138 kV transmission line estimated costs. The original estimate had
unnecessarily included fiber optic shield wire instead of a lower cost standard steel
shield wire. The revised Facility Study Report estimate was updated to reflect a
standard steel shield wire. The second revision was an update to the project schedule
estimate to reflect the new dates for executing a signed agreement and receiving
construction funding. The Revised Facility Study Report included an updated estimated
cost for the 138/34.5 kV 30 MVA substation and 138 kV transmission line of $8.3
million.
On November 28, 2012, the Company received a letter 5 from Glanbia's President
and Chief Executive Officer Jeff Williams. The letter expressed concern regarding the
estimated costs for the facilities upgrade. Mr. Williams noted that Idaho Power had
failed to account for two discounts to the upgrade costs, what Glanbia characterized as
"System Betterment" and "Allowances." These references to System Betterment and
Allowances referred to defined terms within Idaho Power's Rule H, New Service
Attachments and Distribution Line Installations or Alterations ("Rule H").6 Within Rule H,
Company Betterment means the "portion of the Work Order Cost of a Line Installation
and/or Alteration that provides a benefit to the Company not required by the Applicant or
Additional Applicant." Similarly, Line Installation Allowances is also a defined term
"Cover letter dated November 27, 2012, and Revised Facility Study Report dated November 27,
2012, is included as Attachment 3 to this Answer.
Letter dated November 28, 2012, addressed to Idaho Power Chief Executive Officer J. LaMont
Keen sent by Jeff Williams, President and Chief Executive Officer of Glanbia, is included as Attachment 4
to this Answer.
6 I.P.U.C. No. 29, Tariff No. 101, First Revised Sheet No. H-I.
ANSWER-4
within Rule H that means the "portion of the estimated cost of the Line Installation
funded by the Company."
On December 13, 2012, Idaho Power President and Chief Financial Officer
Darrell Anderson responded to Glanbia's November 28, 2012, letter, a copy of which is
included as Exhibit C to Glanbia's Petition. Mr. Anderson explained Idaho Power's
position on "Company Betterment" allowed under appropriate circumstances by Idaho
Power's Rule H. Mr. Anderson's letter explained that first and foremost, Company
Betterment, as defined in the Company's Commission-approved Rule H tariff, is
applicable only to distribution facilities—not to the transmission and substation facilities
that would be required by Glanbia's expansion. Mr. Anderson further explained that
Company Betterment is broadly defined as the installation of facilities or work performed
that is in excess of that requested or required by the customer. Mr. Anderson also
explained that Glanbia misconstrued Company Betterment to include what Glanbia
characterized as "available capacity" at the substation currently used to serve Glanbia's
load. The Company does not anticipate the load in that area to increase significantly in
the near term and, consequently, Glanbia's request does not provide the Company with
the betterment value that Glanbia suggested. Mr. Anderson addressed the request for
consideration of "Allowances" by again explaining to Glanbia that the requested facilities
are not governed by Rule H, as the Rule's preface states it "does not apply to
transmission or substation facilities. ,7
On February 11, 2013, at Glanbia's request, the Company held a meeting at
Idaho Power's headquarters where Glanbia proposed Idaho Power use the allowance
methodology that has been described in greater detail in Exhibit B to Glanbia's Petition.
I.P.U.C. No. 29, Tariff No. 101, First Revised Sheet No. H-i.
i1TATAU1
Following review and consideration of the proposal, Idaho Power teleconferenced with
Glanbia on February 19, 2012, to explain that the Company had once again reviewed
Glanbia's request, and that the Company's position with regard to Glanbia's proposed
allowances had not changed because Rule H specifically excludes transmission and
substation upgrades. Moreover, Idaho Power expressed concern that Glanbia's request
would unfairly impact other customers and thus could not support it.
Glanbia requested a meeting with Idaho Power at the Company's headquarters
on April 3, 2013. During that meeting, Glanbia presented a draft petition to be filed with
the Commission if Idaho Power would not meet Glanbia's requests. Idaho Power
advised Glanbia on April 5, 2013, that it could not accommodate Glanbia's requests and
remain consistent with its tariff and past practice.
II. IDAHO POWER'S POSITION
Idaho Power evaluated Glanbia's request in a fair manner, consistent with
previous evaluations of customers with growing loads. Idaho Power properly followed
its tariff, rules, and regulations in assessing Glanbia's proposals. However, three of
Glanbia's four arguments assume that the requested facilities are those that would be
covered under Idaho Power's Rule H, which they are not. Glanbia's request would
require a new 10 mile 138 kV transmission line and a new 30 MVA substation, and this
falls outside the provisions of Rule H. Rule H applies only to distribution facilities and,
on that basis, it would be improper and outside the scope of Rule H to apply its
provisions to transmission facilities. Schedule 19 states, "To the extent that additional
facilities not provided for under Rule H, including transmission and/or substation
facilities, are required to provide the requested service, special arrangements will be
ANSWER-6
made in a separate agreement between the Customer and the Company. ,8 The plain
language of the tariff clearly states that Rule H does not apply to Glanbia's request.
Glanbia's Petition claims that because Idaho Power's Rule H does not
specifically define what a transmission or substation facility is, Glanbia's 138 kV
transmission line should be treated as a distribution facility. However, Idaho Power's
Rule B Definitions ("Rule B"), which sets forth the meanings of terms which are
frequently used in the tariff, clearly states "Transmission Service is service taken at 44
kV or higher."9 Because Glanbia's proposed transmission line is 138 kV, it cannot
reasonably be considered distribution facilities that fall under Rule H.
While Idaho Power contends that Glanbia's request for service is not covered
under its Rule H, the Company will nonetheless respond to each of the requests for
relief set forth in the Petition.
A. Allowances, Company Betterment, and Vested Interest under Rule H.
Glanbia claims in its Petition that Idaho Power has "refused to entertain the
concept of an allowance" and has "refused to entertain the concept of compensating
Glanbia for the value of the soon to be freed-up capacity" related to the requested
facilities upgrade.10 Idaho Power has repeatedly entertained Glanbia's requests since
Glanbia's initial request for increased load was received on July 25, 2012. Idaho Power
considered Glanbia's request to serve its increased load and concluded that it does not
properly belong under the provisions of Idaho Power's Rule H. Consequently, Glanbia
is not entitled to allowances, Company Betterment, or Vested Interest under Rule H.
8 No. 29, Tariff No. 101, First Revised Sheet No. H-I. (Emphasis added.)
LP.U.C. No. 29, Tariff No. 101, Original Sheet No. B-2.
10 Petition, p. 4.
ANSWER-7
Allowances provided under Rule H are calculated based on the cost of providing
Standard Terminal Facilities for single phase and three phase services.11 "Standard
Terminal Facilities" are the overhead Terminal Facilities 12 the Company considers to be
most commonly installed for overhead single phase and three phase services. 13
Exhibit B to Glanbia's Petition cites Commission Staff ("Staff') Comments filed on
April 17, 2009, in Case No. IPC-E-08-22 to indicate Staff proposed an embedded-rate
methodology for the calculation of Allowances. 14 In Order No. 30853, issued July 1,
2009, the Commission stated, "The Commission finds that Idaho Power's proposed
fixed allowances . . . represent a fair, just and reasonable allocation of line extension
costs.05 In the same order, the Commission stated, "Idaho Power shall make an
annual filing, no later than January 1 of each year, updating allowance amounts for
single- and three-phase service to reflect current costs for 'standard' terminal
facilities. 06
The Commission further clarified its support for Idaho Power's method of
calculating allowances based on Standard Terminal Facilities in its Reconsideration
Order No. 30955, where the Commission rejected the argument that the policy driving
the methodology to calculate Allowances could not change:
The Contractors first assert that our recently approved
changes to Rule H are inconsistent with the methodology
that the Commission adopted in the 1995 Rule H case. BCA
I.P.U.C. No. 29, Tariff No. 101, First Revised Sheet No. H-Il.
12 In the context of Rule H, "Terminal Facilities include transformer, meter, overhead service
conductor, or underground conduit (where applicable)."
13 I.P.U.C. No. 29, Tariff No. 101, First Revised Sheet No. H-3.
14 Glanbia Petition, Exhibit B, p.1.
15 Case No. IPC-E-08-22, Order No. 30853 (July 1, 2009), p. 10.
16 1d., p.11.
ANSWER-8
implied that the Commission cannot change its methodology
from the 1995 case. We reject this argument . . . to the
extent practicable, utility costs should be paid by those that
cause the utility to incur the costs. If the "cost-causers" do
not pay, the electric rates for other customers will be higher.
Different circumstances exist now than did in 1995.17
Glanbia's proposed allowance as calculated in Exhibit B to the Petition
represents a re-packaging of a computation Staff presented in initial comments in Case
No. IPC-E-08-22, which was not adopted by the Commission in either its initial Order
No. 30853 or its Reconsideration Order No. 30955. Glanbia's Petition requests that the
Commission issue an order requiring Idaho Power to provide an allowance of
$2,318,000 "or other such amount it determines is appropriately calculated pursuant to
the Commission's methodology underlying Rule H,"18 which, in effect, would result in
other Idaho Power customers paying for the recovery of the costs incurred to serve only
the Glanbia facility. As the Commission indicated in the quote above, "to the extent
practicable, utility costs should be paid by those that cause the utility to incur the
costs."19
Because Schedule 19 Primary Service ("Schedule 19P") customers are metered
on the primary side of transformation, no Terminal Facilities will be installed by Idaho
Power in order to fulfill Glanbia's request. As is the case with all Schedule 19P
customers, Glanbia will be required to provide its own facilities beyond the Point of
Delivery,20 including Terminal Facilities required to receive service. Under Idaho
17 Case No. IPC-E-08-22, Order No. 30955 (November 30, 2009), P. 21.
18 Petition, p.6.
19 Case No. IPC-E-08-22, Order No. 30955 (November 30, 2009), p. 21.
20 As defined in Rule B, "Point of Delivery is the junction point between the facilities owned by the
Company and the facilities owned by the Customer; OR the Point at which the Company's lines first
become adjacent to the Customer's property; OR as otherwise specified in the Company's Tariff."
ANSWER-9
Power's Rule M Facilities Charge Service, eligible customers may request that the
Company design, install, own, and operate transformers and other facilities beyond the
Point of Delivery that are solely provided to meet the customer's service requirements.
This service is provided at the customer's request and at the option of the Company in
exchange for the customer paying a monthly facilities charge to the Company. Rule H
does not apply to the construction of facilities beyond the Point of Delivery and thus no
allowances should be given.
Glanbia's Petition also seeks compensation for what it characterizes as the soon
to be freed-up capacity in the Toponis substation, as "Glanbia will be allowing
approximately ten megawatts of capacity in that substation to be used to serve other
customers."21 The Company considered whether granting Glanbia some Company
Betterment amount would be appropriate in this instance, but after reviewing its load
forecast for the area, the Company concluded that there is no indication for additional
capacity needs in that substation in the near term. Likewise, the Company would not
benefit from "operation or maintenance efficiencies" if Glanbia's project were
completed.22 Idaho Power does not believe it is in the best interest of its customers to
pay for capacity it does not need. In Order No. 29529, the Commission reached a
similar conclusion when it found that "If no contribution had been required . . . Idaho
power would have borne the full risk that enough other customers would eventually
materialize to utilize the available capacity. ,23
In addition to allowances and Company Betterment, Glanbia also seeks Vested
Interest. Under Rule H, "Vested Interest" is defined as "the right to a refund that an
21 Petition, p. 4.
22 Case No. IPC-E-95-03, Order No. 26063 (June 23, 1995), p.2.
23 Case No. IPC-E-00-12, Order No. 29529 (July 16, 2004), p. 6.
ANSWER -10
Applicant or Additional Applicant holds in a specific section of distribution facilities when
Additional Applicants attach to that section of distribution facilities. Q4 Glanbia's request
would not require the construction of any distribution facilities, and therefore would not
qualify for any Vested Interest under the provisions of Rule H.
B. Competitive Bidding.
Glanbia's Petition asks the Commission to require Idaho Power to competitively
bid the material and work, provide audited records to Glanbia, and allow Glanbia to be
included in the selection of a contractor.25 Because Idaho Power is responsible for
owning, operating, and maintaining the facilities, it is appropriate that Idaho Power
design, engineer, and select contractors for the facilities. The Commission and its Staff
are familiar with the validity of the Company's construction and bidding practices, which
are reviewed during the Company's applications for Certificates of Public Convenience
and Necessity and during the annual Rule H tariff update. On this basis, the Company
requests the Commission deny Glanbia's request to allow it to participate in Idaho
Power's design, engineering, and selection of contractors on the project.
The Company continually works to ensure that its construction costs are
reasonable. In fact, on February 1, 2013, Idaho Power solicited non-binding
Engineering, Procurement, and Construction ("EPC") proposals from four contractors
through the Company's Request for Information ('RFI") process. Idaho Power received
responses from all four contractors on March 14, 2013, with contractor responses
ranging from 34 percent to 75 percent higher (when the applicable overheads and tax
24 No. 29, Tariff No. 101, Second Revised Sheet No. H-4.
25 Petition, p.4.
gross-up were added to the contractors' responses) than Idaho Power's estimated cost
of $8.3 million for Idaho Power to complete the work.26
If Glanbia proceeds with the project, Idaho Power will perform a true-up of actual
costs and will refund amounts to Glanbia or collect amounts from Glanbia where the
estimated payment is over or under actual costs. Idaho Power will provide, at Glanbia's
request, a detailed cost report showing all charges to the work order(s) involved in
completing the work to install the necessary facilities for Glanbia. This process is
consistent with how Idaho Power responds to all requests of this nature for new or
added load for Schedule 19P customers.
The Company permits customers to own, operate, and maintain their own
transmission and substation facilities so long as those facilities are not harmful to the
safety, reliability, and integrity of Idaho Power's interconnected system. In the event
Glanbia would like to select its own contractor to build Glanbia-owned and -operated
facilities, Idaho Power will work with Glanbia to interconnect those facilities to Idaho
Power's system.
III. COMMUNICATIONS AND SERVICE OF PLEADINGS
Service of pleadings and communications with reference to this case should be
sent to the following:
Lisa D. Nordstrom
Regulatory Dockets
Idaho Power Company
1221 West Idaho Street (83702)
P.O. Box 70
Boise, Idaho 83707
Inordstrom(idahopower.com
dockets(idahopower.com
Warren Kline
Mike Youngblood
Idaho Power Company
1221 West Idaho Street (83702)
P.O. Box 70
Boise, Idaho 83707
wkIineidahopower.com
myoungbIoodidahopower.com
26 Power's EPC Summary is included as Attachment 5 to this Answer.
ANSWER- 12
IV. CONCLUSION
Idaho Power values its business with Glanbia and spent considerable time over
the last nine months, including the time of several of the Company's executive officers,
evaluating Glanbia's requests within the constraints that govern Idaho Power's actions
as a regulated utility. In formulating its position, Idaho Power ensured that it was acting
consistently with the Rules found in its Commission-approved tariff. The Company also
considered its past treatment of similarly situated customer requests in accordance with
Idaho Code § 61-315's anti-discrimination/anti-preference requirements.
Glanbia's Petition requests special treatment that other similarly situated
customers have not received nor been entitled to. To grant Glanbia's request, a change
in regulatory policy would need to occur that shifts cost responsibility for transmission
and substation facilities required by a single entity, like Glanbia, to other customers of
Idaho Power. Idaho Power does not support financing the upgrade of such facilities
required by a single industrial customer by increasing the rates of others.
Therefore, for the reasons stated above, Idaho Power requests that the
Commission deny Glanbia's Petition in accordance with Idaho Power's approved tariff
that includes Rule H.
Dated at Boise, Idaho, this 26th day of April 2013.
(L 7C
USA D. NORDSTROM
Attorney for Idaho Power Company
ANSWER- 13
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 26th day of April 2013 I served a true and correct
copy of the within and foregoing ANSWER upon the following named parties by the
method indicated below, and addressed to the following:
Commission Staff
Weldon Stutzman
Deputy Attorney General
Idaho Public Utilities Commission
472 West Washington (83702)
P.O. Box 83720
Boise, Idaho 83720-0074
Industrial Customers of Idaho Power
Peter J. Richardson
Gregory M. Adams
RICHARDSON & O'LEARY, PLLC
515 North 27th Street (83702)
P.O. Box 7218
Boise, Idaho 83707
X Hand Delivered
U.S. Mail
Overnight Mail
FAX
X Email Weldon. Stutzman(äDuc.idaho.qov
Hand Delivered
X U.S. Mail
Overnight Mail
FAX
X Email petercrichardsonandolearv.com
cjrearichardsonandolearv.com
0)44A~& rf-) tLLL
Christa Bearry, Le -Assts ant
ANSWER -14
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-13-09
IDAHO POWER COMPANY
ATTACHMENT 1
-J A
August 9, 2012
Mr. Jason Roethig
Glanbia Foods
1373 Fillmore Street
Twin Falls, ID 83301
Subject: Glanbia Gooding 7MW Load Request
Dear Mr. Roethi&
Enclosed is the final Feasibility Study Report for the provision of an additional 7MW of load at
the Glanbia facility in Gooding, ID for a total of 16MW of load. In that report two options of
service are identified. The first option is to upgrade the Toponis substation transformer to a
larger size and upgrade approximately 5 miles of distribution. The second option is to install a
new substation on the Glanbia site with 20MW of capacity. This substation would be able to be
initially installed with greater capacity, if desired, or expanded to up to 40MW of capacity in the
future. The schedule to complete these upgrades is estimated to take no more than 18 months
from start of engineering to construction completion. If you would like to have a meeting to
discuss any details in this report or discuss the proposed upgrades, please let me know.
Otherwise, the next step to move one of these options forward is to conduct a more thorough
Facility Study. The Facility Study is a detailed design layout with specific cost and schedule
estimates, requires a $20,000 deposit, and takes approximately 45 business days to complete.
The Facility Study will also include an Engineering and Procurement (E&P) Agreement for
additional engineering fees and long lead material items.
Idaho Power is committed to working with (3lanbia Foods to meet their electrical energy
requirements. If you would like to discuss this project further, please contact me directly at
(208) 388-2895. Please note that the estimates provided and the available capacity identified in
the report are subject to change, and therefore should be viewed as valid for 60 days only.
If you have any questions or need additional information, please give me a call.
Sincerely,
otlla~jl~~
Daniel Arjona
Engineering Leader; T&D Planning s-
cc: Dave Angell IPCo Travis McMillen IPCo
Mike Pohanka IPCo Steve Fullmer IPCo
1221 W. Idaho St. (83702)
P.O. Box 70
Boise, ID 83707
IWi teJ D Sjj 1
FEASIBILITY STUDY
In
GOODING, IDAHO
To the
IDAHO POWER COMPANY ELECTRICAL SYSTEM
For
GLANBIA FOODS
The
LARGE LOAD CUSTOMER
FINAL REPORT
8/9/2012
1.0 Introduction
Glanbia Foods has contacted with Idaho Power Company (IPCO) about providing service for an
additional 7 MW load to its facility in Gooding. The location of the project is in Idaho Power's
service territory.
This report documents the basis for and the results of the Feasibility Study for the Glanbia Foods
Large Load addition. It describes the proposed project and estimated costs for connection and
determination of load connection feasibility.
2.0 Summary
It was determined that there are two options to serve 16MW of total load at the Glanbia Gooding
facility.
Option 1: Upgrade Toponis station transformer and upgrade distribution to the Glanbia facility,
$5.7M, 1.5 yrs
Option 2: New substation on Glanbia Gooding site, $6.3-$11.9M depending on desired
reliability, 1.5 yrs
3.0 Description of Proposed Large Load Request
Glanbia Foods is proposing to add 7 MW of load at its facility in Gooding, Idaho. This load is in
addition to their 9 MW of existing load for a total of 16 MW.
4.0 Description of Transmission Facilities
Glanbia is presently fed from Toponis substation which is radially fed off Idaho Power's 138 kV
transmission system. This system currently has capacity for the additional load during both the
winter and summer peaks. Also, no voltage problems are evident with the additional load.
Overall, the 138 kV system is adequate for the 7 MW of additional load.
5.0 Description of Substation Facilities
There is presently 30MVA of transformer capacity at Toponis station. It is currently serving 26.5
MW of load in peak conditions. As of now, there is not enough capacity to add the additional
load as requested by Glanbia.
6.0 Description of Distribution Facilities
An existing 34.5kV feeder from Toponis station (TOPN-41) already provides 9MW of capacity
to the Glanbia facility as well as supplying approximately 10MW of demand from other
customers connected to this distribution feeder. The feeder is composed of 336AA and 2/0 AA
conductor. The 2/0 AA conductor does not have the capacity to serve the additional 7MW
request. There is not capacity on this feeder to handle this addition without upgrades.
-2-
Table 1: Events by Year
Table 2: Breakdown of Events
7.0 Description of Reliability
The following tables list the recorded outage events on the TOPN-41 distribution feeder and the
King-Wood River transmission line between 1999 and 2012. This transmission line would feed a
new substation at Glanbia.
In 2005 JPCo did a major maintenance project involving replacing all wood pins and cross arms
from the substation along the highway almost the entire length to Glanbia' s point of
interconnection (roughly 8 miles of distribution line). This significantly changed the number of
distribution events as you can see in the number or distribution outages by year after 2005.
-3-
• Pertinent calculations from events taking place from 1999-6/2012:
• Average Distribution events/year => 6.7
• Average Transmission events/year => 2.7
• Ratio of Distribution to Transmission events => 2.5
• Average Distribution trip/closes per year => 3.4
Trip/close is when the power is interrupted momentarily and then restored
seconds later to clear a momentary fault (e.g. bird contacting the line and
faulting it, bird is electrocuted, bird falls to the ground clearing the line so
no problem remains, power restored after say 10 seconds).
• Pertinent calculations from events taking place from 2006 - 6/2012 (to see difference
from distribution maintenance completed in 2005 on distribution events):
• Average Distribution events/year => 3.8
• Average Transmission events/year => 3.1
• Ratio of Distribution to Transmission events => 1.3
• Average Distribution trip/closes per year => 2.2
Trip/close is when the power is interrupted momentarily and then restored
seconds later to clear a momentary fault (e.g. bird contacting the line and
faulting it, bird is electrocuted, bird falls to the ground clearing the line so
no problem remains, power restored after say 10 seconds).
With the new substation option implemented, it could be assumed that the number of distribution
events/year could drop drastically from the current values ranging from 3.8 - 6.7 (depending on
timeframe used). Even with the substation option, there will still be expected distribution events
(transformer failures, cable conductor failures, bird in primary meter package, etc.), however I
would expect the number of events due to these causes to be significantly less than the current
number of distribution events. As can be seen in the calculations and tables above, there are 2.2
- 3.4 average outages per year just from trip/closes. This major contributor to the number of
distribution events will see the greatest decrease from the installation of a substation.
8.0 Description of Service Plan
There are two options to serve a total of 16MW of load at the Glanbia Gooding facility:
Option 1: Upgrade Toponis station transformer to 44.8MVA and upgrade distribution to the
Glanbia facility. Approximately 5 miles of feeder upgrades would be required. If more than
20MW of load is desired in the future, Idaho Power recommends a substation be built on the
customer's property. Option 1 leaves less flexibility in the case of load growth beyond 20MW
and subjects the customer to up to ten miles of 34.5kV overhead distribution line exposure.
Option 2: Build new substation on customer property with 20MVA 138kV:34.5kV transformer.
Connect substation to existing Idaho Power 138kV line from Toponis station or from a point on
the King-Wood River 138kV line. Feed the Glanbia terminal facilities with one 34.5kV feeder
from the station. Depending on the customer's reliability needs, the substation can be built with
redundant 138kV feeds with power circuit breakers or with a single 138kV feed without a
breaker. The cost and size of the substation will depend on the final configuration. For
reference, the "minimum" and "maximum" versions of the substation are listed below:
-4-
"Minimum" substation:
. 215' X 140' land size
20MVA 138:34.5kV transformer
• Single 138kV feed with no power circuit breakers
"Maximum" substation:
• 215' X 165' land size
• 30MVA 138:34.5kV transformer
• Two 13 8k feeds with two 13 8k power circuit breakers
This option provides minimal exposure on overhead 34.5kV distribution and provides greater
flexibility in the case of load growth beyond 20MW. If there is a possibility more than 20MW of
load is desired in the near future, a larger transformer can be installed initially at a greater up-
front cost, but would prevent paying for a new, larger transformer in the future. The substation
could be upgraded to provide up to approximately 40MW on the same substation footprint.
9.0 Harmonic Filtering Affects
The following points describe the harmonic filtering affects of the existing Glanbia facility and
of the options presented in this feasibility study:
• Existing facility (no upgrades have been done at substation or distribution infrastructure)
a IEEE-519 requirement levels for 9MW peak load (IL = 150A) with 'Sc = 1400A
• Isc/1L1400A/150A9.3
• Thus the filtering requirements are at the most stringent at the below levels
'SC/IL <11 11h<17 17h<23 23h<35 35<h TDD
<20* 4.0 2.0 1.5 0.6 0.3 5.0
• Option 1
o IEEE-519 requirement levels for 16MW peak load (IL= 270A) with ISc = 1715A
'Sc' IL= 1715A / 270A = 6.4 which is still at the most stringent filtering
requirements listed on the above table.
• Option 2 with a 20MVA transformer, primary meter just outside station which assuming
is Point of Common Coupling
o IEEE-519 requirement levels for 16MW peak load (IL = 270A) with 'Sc = 2600A
'Sc I IL = 2600A / 270A = 9.6 which is still at the most stringent filtering
requirements listed on the above table.
• Option 2 with a 30MVA transformer, primary meter just outside station which assuming
is Point of Common Coupling
o IEEE-519 requirement levels for 16MW peak load (IL= 270A) with Isc = 3500A
• Ic/ IL = 3500A / 270A = 13.0 which is still at the most stringent filtering
requirements listed on the above table.
In general, any of the upgrades to serve a 16MW peak load will not change the IEEE-519
filtering requirements at the PCC (Point of Common Coupling; interconnection point).
-5-
10.0 Cost Estimate
The estimated costs to add 7 MW to the Glanbia facility in Gooding are:
Table 3: Cost Estimates for Option 1
Table 4: Cost Estimates for Option 2, "Minimum" substation
Table 5: Cost Estimates for Option 2, "Maximum" substation
9.0 Conclusion
The large load request adding 7 MW at Glanbia Foods in the City of Gooding to Idaho Power's
system was studied. The results of this study indicate that it is feasible to connect this project to
the existing Idaho Power system and that there are two potential options to go about doing this.
-6-
Description Estimated Cost
Rebuild 5.0 miles of 46kV pole with 34.5kV and
12.5kV underbuilt distribution $3,000,000
Upgrade substation transformer to 44.8MVA $1,000,000
10% Contin gency and 31% Tax Gross up $1,700,000
Total Estimated Cost $5,700,000
Timeframe Estimated 1.5 years
Description Estimated Cost
New 10 miles of 138kV single pole, single circuit $2,500,000
New 20MVA substation transformer $650,000
New substation with single 138kV feed, no breakers $1,250,000
10% Contingency and 31% Tax Gross up $1,900,000
Total Estimated Cost $6,300,000
Timeframe Estimated i.s years
Description Estimated Cost
New 10 miles of 138kV single pole, double circuit $6,000,000
New 30MVA substation transformer $850,000
New substation with two 138kV feeds, two 138kV
power circuit breakers with communication $1,550,000
10% Contingency and 31% Tax Gross up $3,500,000
Total Estimated Cost $11,900,000
Timeframe Estimated i.s years
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-13-09
IDAHO POWER COMPANY
ATTACHMENT 2
HO i~w 1ER
An IDACORP Company
November 9, 2012
Mr. John Mutchier
Executive Vice President
Glanbia Foods, Inc
1373 Fillmore Street
Twin Falls, Id. 83301-3380
Subject: Potential Strategies for Mitigation of Glanbia Foods Gooding Facilities Upgrade Costs
Dear Mr. Mutchler:
During a meeting held on October 18, 2012 at the offices of Idaho Power Company
("Company" or "Idaho Power") between representatives of Glanbia Foods, Inc. ("Glanbia") and
Idaho Power, Company representatives agreed to seriously consider alternative means to
mitigate the costs associated with the integration of an additional seven megawatts ("MW") of
power to Glanbia's facility in Gooding, Idaho, bringing Glanbia's total load to 19 MW. This
letter describes the subsequent meetings held by Company personnel to discuss alternative
solutions to offset the upgrade costs and the results of those discussions.
At the October 18 meeting, the Company was requested to consider two possible
alternatives proposed by Glanbia as a potential means to mitigate the additional costs of the
facilities upgrade required. Below is a description of the Company's understanding of Glanbia's
proposals, and the results of the Company's consideration:
1)Glanbia suggested that they might receive a credit for the reduction in their loss factor as
a result of moving from taking service at the distribution voltage level to taking service at
the transmission voltage level.
Company's Response: Current customer rates for Schedule 19P and Schedule 19T
already take into consideration the differences included in taking service at differing
voltage levels, including a consideration for the reduction in loss factor. Therefore the
credit suggested by Glanbia is reflected in the form of lower rates associated with
Schedule 19T. By providing Glanbia with an additional credit, while at the same time
providing the benefit of taking service at the lower rate ,the customer would be "double-
dipping", or receiving both the credit and the benefit of the lower rate at the higher
voltage level of service. This is not a viable option.
2)By vacating existing facilities, Glanbia suggested that they would be creating "available
capacity" that the Company could use elsewhere, and therefore, Glanbia could receive a
credit.
Company Response: The costs associated with the facilities Glanbia suggests would be
made "available" for additional capacity are already included in rates, and Glanbia, along
with the other customers taking service on the Schedule 19 rate, are paying their load
1221 W. Idaho St. (83702)
P0. Box 70
Boise, ID 83707
John Mutchier-Glanbia Foods, Inc. Page 2 of 2 November 9, 2012
ratio share of those pooled facilities. Any benefits associated with Glanbia discontinuing
its use of those facilites, if they exist, would be reflected in future Schedule 19 rates. It
would not be appropriate to directly assign a credit to Glanbia for vacating those
facilities. This is not a viable option.
The following is a description of the addtional options discussed and considered by the
Company to potentially mitigate the cost for the Glanbia upgrade:
1)Glanbia Build and Own Option: Under this option, Glanbia would build, own, operate
and maintain the substation facilities, and buyout the existing terminal facilities. This
option could reduce the initial cost of the facilities upgrade as presented by the Company
by not incurring the addition of the tax gross-up amount the Company is required to
collect when receiving a large Contribuition in Aid of Construction (CIAC) payment.
The amount of the tax gross-up may represent a sizable portion of the initial cost for the
facilities upgrade presented by the Company, and removal of that amount may provide
Glanbia with the reduction in the initial cost of the facilities upgrade. It should be noted
however, that under this option, Glanbia would be required to operate and maintain the
substation facilities on an ongoing basis.
• The Company's conclusion is this is a viable option for Glanbia.
2)Company Build, Own and Finance Option: Under this option, the Company would
build, own, operate and maintain the substation facilities, and then offer Glanbia a
separate financing agreement. The option of offering a separate financing agreement for
a customer has historically been contrary to Company policy. Nevertheless, in an attempt
to mitigate the initial cost of the facilities upgrade presented by the Company, this option
was proposed and pursued diligently. A separate meeting was held with the Company's
senior officers to specifically discuss at length and consider this proposed change in
Company policy from a legal and regulatory perspective. At the end of the meeting. the
Company reaffirmed its position that it is not a financial institution, and would not be
offering its customers a separate financing agreement.
• The Company's conclusion is this is not a viable option for Glanbia.
The Company's assessment of alternative ways to mitigate the initial cost for the
facilities upgrade required for Glanbia resulted in one viable option as described above. If
additional suggestions are proposed, the Company will consider them in due course.
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-13-09
IDAHO POWER COMPANY
ATTACHMENT 3
I%HO NER®
An IDACORP Company
November 27th, 2012
Mr. Jim Bergin
Glanbia Foods, Inc
1373 Fillmore Street
Twin Falls, Id. 83301
Subject: Glanbia Foods - Facility Study Report
Dear Mr. Bergin:
With this letter, please find a revised Facility Study Report (FSR) for the integration of an
additional seven MW of power (for a total of 19 MW) at your Glanbia Foods facility in Gooding,
Idaho. This FSR documents the upgrades to the Idaho Power Company (IPC) electrical system
required to meet your load request as outlined in option 42 in the Large Load Feasibility Study
report (dated August 9, 2012) produced by IPC. Standard electrical system reliability analysis of
the FSR upgrades indicates a greater than 40% reduction of the expected annual service outage
time. Please be aware that the transmission line and substation identified in this study will be
owned, operated, and maintained by Idaho Power Company and are available to serve other
customers.
Only two revisions have been made to the FSR. The first is a $652,203 reduction in the 138 kV
Transmission Line Estimated Costs. The original estimate included an optical ground wire (fiber)
instead of a shield wire. This was an oversight on the original transmission line estimate and the
revised FSR estimate has been updated to account for this correction. The second revision to the
FSR is to update the project schedule estimate to reflect the new dates for executing a signed
agreement and receiving construction funding. If you have questions about the estimated costs, I
can schedule a meeting with the appropriate Idaho Power personnel to meet with you and review
the estimates with Glanbia Foods representatives.
In order to proceed with the work identified in this FSR, you will need to execute a contract with
Idaho Power for the construction of the required facilities and set up a payment schedule for
funding the project. Please keep in mind that the indicated project costs are estimates only, and
that Glanbia Foods will be responsible for actual costs which will be trued up as construction
proceeds and upon project completion.
1221 W. Idaho St. (83702)
P.O. Box 70
Boise, ID 83707
Jim Bergin-Glanbia Foods Gooding, Id Page 2 of 2 11/27/2012
The indicated schedule dates are estimated milestones and are not guarantees. The milestones
and construction schedule referenced in the facility study will only be valid and begin upon
execution of an agreement with Idaho Power for construction of the required facilities as well as
receipt of payment. The schedule is based on agreement execution by December 14, 2012 and
funding being received by December 21, 2012. If these dates are not met, the overall schedule
will be changed to accommodate additional time. Idaho Power reserves the right to revisit the
schedule and modify the dates at any time.
I look forward to hearing from you.
Sincerely,
Mike Pohanka
Major Customer Representative
Idaho Power I Customer Relations
mDohanka@idahopower.com
208-736-3226
End: Facility Study Report
General Location Substation Drawing
Single Line Drawing
cc: John Mutchler - Glanbia Foods
Michael McEvoy - Glanbia Foods
Aubrae Sloan - IPC
Ed Kosydar - IPC
Mike Pohanka - IPC
David Joerger - IPC
Brett Flynn - IPC
Ed Helms - IPC
Dave Angell - IPC
Vern Porter - IPC
Warren Kline - IPC
Facility Study
For
GLANBIA FOODS
In
GOODING, IDAHO
IDAHO POWER COMPANY
Revised
November 27th, 2012
Page 1
1.0 Introduction
Glanbia Foods (Glanbia) has contracted with Idaho Power Company (IPC) to prepare this Facility Study
Report (FSR) for the integration of an additional seven MW of power to their facility in Gooding, Idaho.
This will bring Glanbia' s total load to 19 MW. This FSR documents the upgrades to the IPC electrical
system required to meet this load request and is based upon the requirements outlined in a Large Load
Feasibility Study (dated August 9, 2012) produced by IPC.
2.0 Required Upgrades to the IPC Electrical System
In order to provide a total of 19 MW (nine MW existing, three MW planned, seven MW requested) to
the Glanbia facility, a new substation will need to be constructed at that location. A new ten mile long
138 kV transmission line will need to be constructed to bring power to this new substation. See the
attached line route map, substation single line diagram, and substation general location drawing. These
new upgrades to the IPC electrical system will be owned, operated and maintained by IPC and as such
are available to serve other customers.
3.0 Engineering Overviews
Substations: Design and construction of substation work will be carried out to IPC specification. The
substation will consist of a standard grounded, graveled, fenced yard. Equipment will rest on concrete
foundations with either aluminum or galvanized steel support structures. Standard IPC substation
equipment and apparatus will be used in order to have the ability to backup and quickly replace
equipment as well as for maintenance efficiency. Geotechnical and land surveys will be performed as
necessary to support design and construction. A three-leg dead-end structure will be installed for the
transmission line. Other equipment installed include air break switches 041B and 042B for line
switching; 10 1X and 042X for an emergency mobile transformer connection; and 13 1X, 131 Z, and 131 L
for transformer protection and switching. The distribution feeder lines and breakers were requested
utilizing an open bus arrangement. This arrangement requires a control building to house the control
equipment, consisting of relay and communication panels, DC batteries, SCADA equipment, load
centers, and cabling.
Lines: Standard IPC design and construction will be utilized. Transmission structures will be wood
single pole structures with a single shield wire.
Line Right-of-Way (ROW): In order to avoid the high costs associated with relocating a transmission
line, IPC requires private ROW easements for these facilities. IPC will hire a licensed land surveyor to
create the legal descriptions and confirm ownership and title for the easement properties. IPC will
create the appropriate easement documents for the line route, and will negotiate with and secure these
easements from the property owners. The costs and time required to secure these easements can vary
widely depending upon the disposition of the property owners.
Page 2
Communication: A dedicated phone line will be the communication path for SCADA, system
protection and control.
Protection: For feeder protection, a standard two-feeder control and relaying panel will be equipped for
the Glanbia feeder (041A) and a future feeder. The panel will be installed in the building. The relaying
will consist of dual SEL-351A's and a shared SEL-501X. A complete control module will be installed
even though half of the equipment will not be used until another feeder is required.
Bus differential protection consists of a standard transformer/bus protection control and relaying panel
equipped to protect the 138/34.5kV transformer and the 34.5kV bus. The panel will be installed in the
building. The relaying will consist of dual SEL-587 relays with associated lockouts. One relay will
wrap the transformer. The other relay will wrap the transformer, both feeders, and the 34.5kv capacitor
bank's bus.
A standard shunt capacitor control and relaying panel will be equipped to protect the 138kV capacitor
bank. The panel will be installed in the building. The relaying will consist of dual SEL-42 1 relays. The
protection requires current inputs from two current transformers (preferably those from a substation
class breaker), a voltage input from a three-phase 138kV instrument transformer, and a voltage input
from the capacitor bank.
4.0 Regulations, Permitting, and Other Requirements
City Permitting: A Special Use Permit or Variance is required by the City of Gooding where the
proposed transmission line transitions through the city boundaries. IPC will be responsible for securing
this permit.
County Permitting: A Conditional Use Permit is required from Gooding County for the substation
portion of this project. IPC will be responsible for securing this permit.
5.0 Customer Requirements
Substation Property: Glanbia will provide right-of-way easements for access to the transmission and
distribution lines across their property, to and from the IPC substation. Glanbia will donate and transfer
ownership of the property necessary for the substation to IPC. IPC will be supplying 34.5 kV power to
Glanbia out of the substation. The cost for all upgrades or. modifications to IPC owned distribution
facilities beyond the point of delivery (metering point) will be added to Glanbia's Distribution Facilities
Investment (DFI) and will be subject to a monthly facility charge.
System Requirements: The proposed factory will need to stay within the power factor requirements set
by IPC. Glanbia will be responsible for this power factor correction. The distribution of this reactive
compensation and single points of failure, that might disconnect large reactive compensation amounts or
large load values, concern IPC due to potential problems like nuisance tripping.
Page 3
Coordination: Glanbia shall coordinate with IPC personnel in all aspects associated with IPC facility
upgrades.
6.0 Estimated Costs
The following tables list cost estimates for the upgrades needed to accommodate the proposed project
based on the information available today. Note that this estimate does not include the cost of the
customer's equipment and facilities or costs associated with compensating for power factor. If the
power factor at the substation transformer requires compensation for power factor or harmonics, these
facilities will also be installed in the substation at the expense of Glanbia. This is discussed further in
the Power Factor Correction Options section below.
Glanbia's payments will not give Glanbia any ownership rights in the new substation and transmission
facilities. All ownership of these facilities will remain with IPC.
Glanbia New 138kV Line and Substation Estimated Costs
138/34.5 kV 30 MVA Substation $2,407,205
Tax Gross Up $746,234
Contingency (20%) $630,688
Estimated Costs $3,784,127
138 kV Transmission Line $2,891,699
Tax Gross Up $896,427
Contingency (20%) $757,625
Estimated Costs $4,545,751
Combined Substation and Transmission Tap Estimated Cost $8329,877
These cost estimates include scoping and design labor, materials, and installation labor costs, overheads,
contingency and tax-gross up. Please note that the ROW easement costs can vary widely depending
upon the property owners. The ROW costs in this estimate are based upon paying 50% of the estimated
value of the land. Allowance for Funds Used During Construction (AFUDC) are not included since this
project will be funded by Glanbia as it moves forward. These are estimated costs only and final charges
to the customer will be based on the actual construction costs incurred, including overheads and
tax-gross up. Please note that the overhead rate and tax gross-up percentages may vary during the year.
Reliability Options
As a result of the increased demand requested by Glanbia, the 138kV transmission system cannot
support their entire load in addition to existing customers' load during certain outages at peak loading
times during winter. There are two low-probability outage scenarios for which this can occur:
Page 4
Outage #1: Bus or breaker short circuit at the King substation (avg repair time = 10 hrs*) during high
loading levels. Frequency of outage is less than 1 in 10 years. This is an upper bound for impact to
Glanbia because there is a probability that the combined load will be within the still available line
capacity, not requiring load to be shed. High loading that would require load shedding if such an outage
occurs, exists for about 1.37% of the year. An optimistic lower bound for the occurrence of an outage
during this time (assuming independence of the two events) would be 1 in 730 years. We would expect
the actual experience to be more like the lower bound than the upper bound.
Outage #2: Increased outage duration due to a sustained short circuit on the 6.9 mile section of the
138kV transmission line between the King substation and the Toponis tap during high loading on the
138kV system. In this scenario, Glanbia would experience an outage until this section of transmission
line is sectionalized for repairs (average sectionalizing time = 30-60 mins*). After the sectionalizing
occurs, the present Glanbia load level could be restored. However, with the additional load level,
restoration of Glanbia will create low voltage at Glanbia and for other customers fed from the 138 kV
transmission line during peak loading in winter. Glanbia could be partially restored, up to nine MW in
this scenario, until repairs are made (average repair time = 6.9 hrs*) or until other affected customer
loading drops to a level for which Glanbia could be completely restored. Frequency of outage is less
than 2 in 11.7 years. As in the case for outage 1, this is an upper bound for the rate of events that affect
Glanbia. The optimistic lower bound is once per 427 years. Again, we expect the actual experience to
be closer to the lower bound.
One of the following options must be chosen in order to ensure reliability to customers is not adversely
impacted due to the requested load increase.
Option Description Cost**
1 IPC automatically sheds entire Glanbia load $0
at proposed substation. This prevents the
shedding of residential customers on other
parts of the IPC 138kV transmission system.
2 Glanbia sets up intelligence to receive signal Equipment funded, owned,
to trip non-critical load such that no more and maintained by Glanbia
than 9MW of critical load remains online
after receipt of this signal.
3 Install 20 MVAr capacitor bank on the $831,400
138kV side of proposed substation. This will
enable service to be maintained during
Outage #1 and will allow total load
restoration after the 138kV system is
sectionalized during Outage #2.
*All outage data is derived from electrical system equipment historical outage data. This data may or
may not reflect future performance.
**Cost estimates listed include 20% contingency, overheads and tax gross-up
Page 5
Power Factor Correction Options
Idaho Power has a design standard that requires all distribution substations to operate at unity power
factor at peak substation loading. With Glanbia's current power factor of 92% and the unknown power
factor of the new equipment, IPC will require power factor correction. With the assumption that
Glanbia' s peak demand will be 19MW at a 90% power factor after the increase in load, the following
are options for correcting the power factor to unity.
One of the following options must be chosen:
Option Description Cost**
1 Install a single 9.0 MVAr 138kV capacitor bank on $714,400
the high side of the transformer at Glanbia.
2 Install 9.0 MVAr 34.5kV capacitor bank in two $991,700 (includes the cost of
4.5MVAr separately switchable sections at the harmonic de-tuning reactors)
proposed substation. Based on simulations,
harmonic de-tuning reactors or other mitigation
measures are required to provide IEEE-519
compliant service. This option will provide
increased substation transformer capacity for future
growth due to reactive power correction on the
transformer low side.
3 Glanbia corrects their power factor to unity within Equipment funded, owned,
the plant. and maintained by Glanbia
**Cost estimates listed include 20% contingency, overheads and tax gross-up
7.0 Estimated Timeline
The schedule for IPC facility upgrades depends on the completion of a signed agreement, funding, and
authorization to proceed.
The following table outlines the sequence of work as we envision the scoping, design, and construction
to take place for the construction of the initial substation and related lines without any of the available
options presented:
Glanbia Project Substation Schedule Estimate:
Signed Agreement with IPC for Construction of Substation 12/14/2012
Receive Construction Funding 12/21/2012
Project Scope Completed 01/18/2013
Design Kick Off 1/22/2013
Design Complete 7/21/2013
Pre-Construction Meeting 8/1/2013
Construction Start 9/17/2013
Test & Commission 3/13/2014
Project In-Service 3/23/2014
Final Construction Cost True-Up 5/30/2014
Page 6
This schedule is based on a signed agreement being completed by December 14, 2012 and receiving
funding by December 21, 2012. If these dates slip, the overall schedule will be changed to
accommodate additional time and these cost estimates may need to be updated. If any of the available
options are chosen, this schedule will need to be modified to take into account the additional work and
time required. Schedule dates are estimated milestones and are not guarantees. Weather, material
availability, ROW easement acquisition, and permitting restriction could adversely impact the schedule.
8.0 General Assumptions
System: The new IPC 138 kV line that will serve the proposed substation will have adequate capacity to
serve the project.
Lines: A new 138 kV line will extend the existing Toponis Tap of the King to Wood River 138 kV line
to provide the energy source for the new substation. The length of this extension will be approximately
10 miles. The new 34.5 kV overhead distribution line(s) will come from the substation. The length of
these distribution line(s) and financing will depend on the location of the substation and the metering
points. It is assumed that ROW easements for the transmission and distribution lines can be obtained in
a timeframe that does not impact the schedule. A Special Use Permit or Variance may be required for
the portion of transmission line extension that passes through the city limits of Gooding enroute to the
substation.
Substations: It is assumed that the new substation will be on property owned by Glanbia and the
required substation property will be given to IPC and ownership transferred to IPC at no cost. It is
assumed that the needed properties can be obtained in close proximity to the locations identified. A
Minor Land Division application must be approved prior to transferring ownership of the property to
Idaho Power and a Conditional Use Permit must be approved prior to construction of the substation.
9.0 Outside of IPC Control
There are numerous items outside the control of IIPC which could impact the execution of the planned
work in this Facility Study. Any of these items could necessitate changes that could impact both cost
and schedule.
• Obtaining Permits, Imposed Restrictions/Requirements
• Obtaining Right-of-way
• Material Availability
• Weather
10.0 Conclusions / Next Step
The requested large load interconnection to IPC's system was investigated and the results of this work
indicate that the existing IPC system can be upgraded to support the 19 MW required. The next step in
the process to connect this large load would be to create a contract with IPC for the execution of the
work. Mike Pohanka can get this process started.
Page 7
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-13-09
IDAHO POWER COMPANY
ATTACHMENT 4
,Stanbia
FOODS
Glanbia Foods, Inc. Telephone (208) 733-7555
1313 F(Imore Street Facsimile (208) 733-9222
31IS ID 83301-3380
November 28, 2012
J. LaMont Keen
President and Chief Executive Officer
Idaho Power Company
1221 West Idaho St.
Bosie, Idaho 83702
Re: Glanbia Foods, Inc. Expansion Costs
Dear Mr. Keen:
I am writing to express our concern regarding Idaho Power Company's estimated costs for upgrading its
facilities to provide an additional seven megawatts to our facility in Gooding, Idaho. Glanbia is
sufficiently concerned about the viability of our proposed expansion that I am writing directly to you in
order to underscore the importance that the costs of the proposed expansion are accurately calculated and
fairly assigned from both Idaho Power's and Glanbia's perspectives.
We are planning to expand our facility in Idaho Power's service territory, in part based on our good
relationship Idaho Power and in part based on your attractive retail rates. Unfortunately, we have been
presented with an upgrade plan and budget that fails to account for two significant discounts to the
upgrade costs and have not yet received a favorable response from Idaho Power. If we are unable to
manage the costs of this upgrade, I fear that the economics of this capital expansion project will diminish
to the point that competing capital expansion projects elsewhere in the Glanbia Group of companies will
prevail over our Gooding, Idaho facility. I am sure this risk causes Idaho Power concern as well. Our
facility is a high quality, high electrical load factor customer and expansion will provide a much needed
economic shot in the arm for this economically underprforrning region of your service territory.
The two areas where we believe Idaho Power needs to provide concrete engineering and economic
analysis involve system betterments and what the Idaho PUC has called "allowances." I will discuss each
briefly below for your consideration.
Glanba Fooc,s, Inc
4 ,jhs,Oer Gk,"&e a
System Betterment:
We have retained an engineering firm that has identified concrete system betterments to Idaho Power's
system as a whole that will be realized should our expansion come to fruition. I do not need to itemize
those betterments here. Suffice it to say that none of our identified system betterments appear to have
found their way into Idaho Power's cost estimates. I understand that the Idaho PUC allows for system
betterments to be factored into line extension and expansion projects. We hope that you will direct your
staff to take another look at this issue with the direction that all system betterments Idaho Power will
enjoy are fully accounted for in the final cost estimates.
Allowances:
Section 7 of Idaho Power's Rule H Tariff provides specific dollar allowances in respect of line extensions
for residential and non-residential customers. It further provides that allowances for Schedule 19,
industrial customers such as Glanbia, are to be calculated on a case by case basis.. No effort has been
made by Idaho Power to identify the allowances Giathia would be entitled to arising from our proposed
expansion. Please consider this a tbrrnal request for Idaho Power to estimate the allowances we would be
entitled to pursuant to the Idaho PUC approved methodology for calculating allowances on a case by case
basis for our expansion.
I am looking forward to your response and a long mutually rewarding relationship with Idaho Power
Company.
Sincerely
Jeff Williams, President & CEO
Glanbia Foods, Inc.
Cc:
Karl Bokenkamp
Greg Said
Mike Youngblood
John Mutchler
Jim Bergin
Daragh Maccabee
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC-E-13-09
IDAHO POWER COMPANY
ATTACHMENT 5
Glanbia Transmission Substation
IPCO EPC (Engineer Procure Construct) Summary
Description IPCO Contractor A* Contractor B ** Contractor C ** Contractor D **
138/34.5 kV 30 MVA Substation $2,407,205 $2,600,000 $0 $0 $0
30 MVA Transformer (Includes 6% Sales Tax) Included $895,125.00 $0.00 $0.00 $0.90
General Overheads (20%) Included $699,025
Tax Gross Up $746,234 $1,300,187 $0 $0 $0
Contingency (20%) $630,688 Included $0 $0 $0
Estimated Costs $3,784,126 $5,494,337 $0 $0 $0
138 kV Transmission Line $2,891,699 $3,400,000 $0 $0 $0
General Overheads (20%) Included $680,000
Tax Gross Up $896,427 $1,264,800 $0 $0 $0
Contingency (20%) $757,625 Included $0 $0 $0
Estimated Costs $4,545,751 $5,344,800 $0 $0 $0
138/34.5 kV 30 MVA Substation & 138kV
Transmission Line $0 $0 $6,839,774 $7,584,000 $8,176,944
30 MVA Transformer (Includes 6% Sales Tax) $0 $0 $895,125.00 $895,125.00 $895,125.00
General Overheads (20%) $0 $0 $1,546,980 $1,695,825 $1,814,414
Tax Gross Up $0 $0 $2,877,382 $3,154,235 $3,374,810
Contingency (20%) $0 $0 Included Included Included
Estimated Costs $0 $0 $12,159,261 $13,329,185 $14,261,292
Idaho Power Support and Oversight of EPC $350,000 $350,000 $350,000 $350,000
Combined Substation and Transmission Tap
Estimated Cost $8,329877 $11189137 $12,509,261 $13679,185 $14,611,292
Timelines: Notice to Proceed - Completion 4/13 -10/14 4/13 -2/14 4/13-4/14 ***
* Contractor did not include ROW and permits in their costs
** Contractor did not break out Substation and Transmission costs seperately
4c Timelines will be given upon award of Contract