20141014Application.pdf

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An IDACORP Company
October 14,2014
VIA HAND DELIVERY
Jean D. Jewell, Secretary
ldaho Public Utilities Commission
47 2 W est Wash i ngton Street
Boise, ldaho 83702
Re: Case No. IPC-E-14-25
ldaho Power Company's Annual Compliance Filing to Update the Load
and Gas Forecasts in the lncremental Cost lntegrated Resource Plan
Avoided Cost Model
Dear Ms. Jewell:
Enclosed for filing in the above matter please find an original and seven (7)
copies of ldaho Power Company's Annual Compliance Filing to update the load and gas
forecasts in the incremental cost lntegrated Resource Plan avoided cost model.
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DONOVAN E. WALKER
Lead Counsel
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Enclosures
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1221 W. ldaho St. (83702)
PO. Box 70
Boise, lD 83707
Donovan E. Walker
DONOVAN E. WALKER (lSB No. 5921)
ldaho Power Company
1221 West ldaho Street (83702)
P.O. Box 70
Boise, ldaho 83707
Telephone: [phone]
Facsimile: [phone]
dwalker@ idahopower. com
Attorney for ldaho Power Company
IDAHO POWER COMPANY'S
ANNUAL COMPLIANCE FILING TO
UPDATE THE LOAD AND GAS
FORECASTS IN THE INCREMENTAL
COST INTEGRATED RESOURCE PLAN
AVOIDED COST MODEL.
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BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. |PC-E-14-25
IDAHO POWER COMPANYS
ANNUAL COMPLIANCE FILING
ldaho Power Company ("ldaho Powe/') hereby respectfully submits to the ldaho
Public Utilities Commission ("Commission") this filing in compliance with Order Nos.
32697 and 32802 to update the load forecast and natural gas forecast components of
the incremental cost lntegrated Resource Plan ("!RP") avoided cost methodology.
I. INTRODUCTION
ln its final Order No. 32697, the Commission determined that the inputs to the
incremental cost IRP avoided cost methodology, utilized for all proposed Public Utility
Regulatory Policies Act of 1978 ("PURPA") qualifying facility ('QF') projects that exceed
the published rate eligibility cap, will be updated every two years upon
IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 1
acknowledgement of the utility's IRP filing, with the exception of the load forecast and
the natural gas forecast-which is to 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 fue! price forecasts and load forecasts annually -between IRP filings. For the sake of consistency, these
annual updates should occur simultaneously with SAR
updates - on June 1 of each year. 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. We find it
reasonable that all other variables and assumptions utilized
within the IRP Methodology remain fixed between IRP filings
(every two years).
Order No. 32697, p.22. The date for the annual update was later changed from June 1
to October 15 of each year. Order No. 32802.
The load forecast, natural gas forecast, and contract information presented below
in compliance with the Commission's Orders has been incorporated into ldaho Powe/s
incremental cost IRP avoided cost methodology. Consistent with the Commission's
prior Orders, this methodology will be utilized by ldaho Power as the starting point for
the negotiation of its contractua! avoided cost rates as of October 15,2014.
II. LOAD FORECAST
ldaho Powe/s most recent load forecast is dated September 9,2014, and is the
same load forecast that will be used in ldaho Powe/s 2015 IRP. This recent load
forecast shows, on average, a slight decrease in ldaho Power customer loads when
IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 2
compared to the October 7, 2013, load forecast that was provided to the Commission
for the 2013 update in Case No. IPC-E-13-18 and approved by the Commission in
Order No. 32941.
Table 1 and Graph 1 below show the average annual load forecast through 2032
for both the previously approved October 2013 load forecast and the most recent
September 201 4 load forecast.
TABLE 1
Average Annual Load Forecast
Year
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
October 2013
(aMW)
1,778
1,817
1,950
1,878
1,892
1,911
1,928
1,953
1,979
2,001
2,020
2,043
2,063
2,095
2,106
2,130
2,151
2,172
2,191
October 2014
(aMW)
1,768
1,785
1,833
1,962
1,991
1,ggg
1,917
1,939
1,962
1,986
2,010
2,035
2,059
2,083
2,105
2,131
2,154
2,175
2,193
IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 3
GRAPH 1
Load Forecast
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-OEbbcr
2ol3 Load Forecdt (.Mwl
-Octobcr
2014 Lord Forc(st (.Mt^r)
,l
_ _ -i _ -l
2,050
2,(x)0
j ts:o
l!
1,9(x)
1,850
L8m
7,750
L700
2014 20ts 20L6 20L7 2018 2019 2020 20,21 20.22 2U23 2Ut4 2o,2s 20,25 2027 2028 2029 2030 2031 2032
III. NATURAL GAS PRICE FORECAST
As of October 15,2014, ldaho Power will update the natural gas price forecast
within the incrementa! cost IRP avoided cost model to reflect the most recent U.S.
Energy lnformation Administration ("ElA") natural gas price forecast. The October 2014
gas forecast, planned for use in the 2015 lRP, is the nominal EIA forecast for Henry
Hub in compliance with the direction from Order No. 32980. It indicates, on average, a
slight decrease in the average annual natural gas forecast prices over the next 20 years
in comparison to the EIA 2013 natural gas price forecast that was used in the
incremental cost IRP avoided cost model presented to the Commission in Case No.
IPC-E-13-18 and approved by the Commission in Order No. 32941 .
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.
IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 4
Table 2 and Graph 2 display the 2013 EIA natural gas price forecast and the
current 2014 EIA natural gas price forecast.
TABLE 2
Henry Hub EIA NaturalGas Forecast
Year
October 2013 As Filed
(nominals)1
collAI
October 2014
(nominals)2
collbl
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
$3.41
$3.51
$4.13
$q.+t
$4.a2
$5.13
$5.39
$5.72
$6.20
$6.66
$7.03
$7.37
$7.82
$8.17
$8.63
$e.02
$9.46
$10.00
$10.47
$3.86
$3.e3
$q.qt
$+.20
$5.27
$5.19
$4.96
$5.37
$5.64
$5.e0
$6.20
$6.45
$o.zz
$7.00
$7.26
$7.63
$8.12
$8.47
$8.91
1 EIA natural gas forecast as previously provided by ldaho Power in
Commission Case IPC-E-13-18 and approved by order 3294L. The nominal
stream reported in Col [A] reflects a 3% annual escalation rate applied to
the 2013 EIA forecast (2011 S).
2 Most recent EIA natural gas forecast (nominal S) published in April 2014.
Nomina! EIA Henry Hub in compliance with Order No.32980.
IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 5
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GRAPH 2
Natural Gas Price Forecast
2014 2015 20t6 20L7 2018 2019 2020 202t 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032
IV. CONTRACT TERMINATIONS. EXPIRATIONS. AND ADDITIONS
ldaho Power cunently has three non-PURPA, long-term power purchase
agreements: Elkhom Valley Wind (101 megawatts ("MW')), Raft River Geothermal (18
MW), and Neal Hot Springs Geothermal (30 MW). ldaho Power currently has 133
contracts with PURPA QF projects with a nameplate capacity of 1,302 MW. This is an
increase of 30 new contracts, and 524 additlonal MW of PURPA QF generation above
the amounts from this time last year. This includes two large solar contracts: Grand
View, 80 MW, and Boise City Solar, 40 MW, which are currently filed with the
Commission, as we!! as 11 new and additional solar QF contracts for a total of 281 MW
signed on October 13,2014. Also included in the new contracts are six new Oregon
solar QF contracts totaling 60 MW, 5 new Oregon wind QF contracts totaling 50 MW,
and several hydro QF contracts making up the balance. New contracts, terminated or
IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 6
expired contracts, as well as new contract pricing are all included in the incremental
cost IRP model on a continuous basis.
V. CONCLUSION
ldaho Power hereby respectfully submits this updated Ioad forecast, natural gas
forecast, and contract information in compliance with the Commission's directives in
Order Nos. 32697 and32802 and asks the Commission to accept the same forfiling.
Respectfully submitted this 14th day October 2]14.
Attorney for Idaho Power Company
IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 7