20131205final_order_no_32941.pdf

Office of the Secretary
Service Date
December 5,2013
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER )
COMPANY’S ANNUAL UPDATE TO LOAD )CASE NO.IPC-E-13-18
AND GAS FORECASTS AND LONG-TERM )
CONTRACTS FOR ITS INTEGRATED )
RESOURCE PLAN AVOIDED COST )ORDER NO.32941
METHODOLOGY.)
Pursuant to the Public Utility Regulatory Policies Act of 1978 (PURPA)and the
implementing regulations of the Federal Energy Regulatory Commission (FERC),the Idaho
Public Utilities Commission (Commission)has approved an Integrated Resource Plan (IRP)
methodology for calculation of avoided cost rates paid to certain PURPA qualifying facilities
(QFs).Avoided cost rates are the purchase price paid to QFs for purchases of QF energy and
capacity.
In Order Nos.32697 and 32802,the Conmiission determined that the load forecast
and natural gas forecast inputs to the IRP avoided cost methodology should be updated annually
by October 15 of each year.The Commission stated
We find that,in order to maintain the most accurate and up-to-date reflection
of a utility’s true avoided cost,utilities must update fuel price forecasts and
load forecasts annually —between IRP filings....In addition,it is
appropriate to consider long-term contract commitments because of the
potential effect that such commitments have on a utility’s load and resource
balance.We find it reasonable to include long-term contract considerations in
an IRP Methodology calculation at such time as the QF and utility have
entered into a signed contract for the sale and purchase of QF power.We
further find it appropriate to consider PURPA contracts that have terminated
or expired in each utility’s load and resource balance.
Order No.32697 at 22.
On October 15,2013,in compliance with Order Nos.32697 and 32802,Idaho Power
submitted its annual updates for fuel prices and load forecasts.The Company also submitted
information regarding new and expiring QF contracts,as well as changes to its long-term
contracts for purchases or sales.
ORDER NO.32941 1
LOAD FORECAST
Idaho Power states that its most recent load forecast is dated October 7,2013,and is
the same load forecast that will be used to prepare the TRP update required by the Public Utility
Commission of Oregon.The Company maintains that the methodology used for the October 7,
2013,load forecast is the same as that used for Idaho Power’s IRPs.The load forecast submitted
by Idaho Power shows,on average,a slight increase in customer loads when compared to the
April 2012 load forecast that was used in the incremental cost IRP avoided cost model presented
to the Commission in Case No.GNR-E-11-03.
GAS FORECAST
As of October 15,2013,Idaho Power has updated the natural gas forecast within the
IRP avoided cost model to reflect the most recent U.S.Energy Information Administration
(“ETA”)natural gas forecast.The natural gas forecast is consistent with that utilized for Idaho
Power’s IRP and is a combination of the EIA Henry Hub and Sumas natural gas forecasts.The
natural gas forecast submitted by Idaho Power indicates,on average,a slight increase in the
average amual natural gas forecast prices over the next 20 years in comparison to the ETA 2012
natural gas forecast that was used in the incremental cost IRP avoided cost model presented to
the Commission in Case No.GNR-E-1l-03.
CONTRACT TERMINATIONS,EXPIRATIONS AND ADDITIONS
Idaho Power currently has 103 QF projects under contract with a nameplate capacity
of 778 megawatts (MW).Idaho Power also currently has three non-PURPA,long-term power
purchase agreements —Elkhorn Valley Wind (101 MW),Raft River Geothermal (18 MW)and
Neal Hot Springs Geothermal (30 MW).Order No.32697 directed utilities to incorporate new
contracts into the TRP avoided cost methodology at the time the QF and utility have entered into
a signed contract.The Order further stated that terminated or expired contracts should be
included in the utility’s load and resource balance.Idaho Power reported that it has included
new contracts and removed terminated/expired agreements.With its filing,Idaho Power
included an updated list of all current QF projects currently under contract with Idaho Power.
COMPLIANCE WITH ORDER NOS.32697 AND 32802
Staff reviewed the Company’s forecast and contract updates.Staff reported that the
load and gas price forecasts submitted by Idaho Power reflect the Company’s most current
estimates and were prepared consistent with the methods used in the IRP.Staff maintained that
ORDER NO.32941 2
the load and gas price forecasts and the long-term contract changes submitted by the Company
comply with the requirements of Order Nos.32697 and 32802.Staff recommended that the
Commission accept the forecasts and contract changes without further process.
DISCUSSION AND CONCLUSIONS
The Commission has jurisdiction over Idaho Power pursuant to the authority and
power granted it under Title 61 of the Idaho Code and Public Utility Regulatory Policies Act of
1978 (PURPA).The Commission has authority under PURPA and the implementing regulations
of the Federal Energy Regulatory Commission (FERC)to set avoided costs,to order electric
utilities to enter into fixed-term obligations for the purchase of energy from qualified facilities
and to implement FERC rules.
Pursuant to its authority,the Commission has reviewed and considered the filings of
record.We find that Idaho Power’s filing complies with the directives issued by this
Commission in Order Nos.32697 and 32802.Based upon our review of the totality of the
updates,we accept the updated inputs to Idaho Power’s IRP avoided cost calculation for filing.
ORDER
IT IS HEREBY ORDERED that Idaho Power’s annual update to its load and gas
price forecast and long-term contract status for purposes of its IRP avoided cost methodology are
accepted,effective October 15,2013.
THIS IS A FINAL ORDER.Any person interested in this Order may petition for
reconsideration within twenty-one (21)days of the service date of this Order.Within seven (7)
days after any person has petitioned for reconsideration,any other person may cross-petition for
reconsideration.See Idaho Code §6 1-626.
ORDER NO.32941 3
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of December 2013.
JLf4C
PAUL K LANd,PRESIDENT
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MACK A.REDFOROMMISSIONER
MARSHA H.SMITH,COMMISSIONER
ATTEST:
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J4D.Jewell.!VCommissionSecretary
O:IPC-E-1 3I8ks
ORDER NO.32941 4