20161021Customer Notice.pdf

~IDAHO ~POWER.
An IDACORP Company
On Oct. 21, Idaho Power submitted
two filings to the Idaho Public Utilities
Commission (!PUC). One is related to the
company's coal-fired North Valmy Power Plant (Valmy)
in Nevada, and the other addresses revisions to the
company's depreciation rates.
Valmy Accelerated Depreciable Life
Idaho Power owns 50 percent of Val my, located near Battle
Mountain, Nevada. The Valmy filing requests adjusting
customer pricing to reflect an accelerated depreciable life for
the power plant. Currently, the depreciable life for Val my is
based on a depreciation schedule that ends in 2031 for Unit
1 and 2035 for Unit 2. The proposed depreciation schedule
would move the date of full depreciation up to 2025 for both
units.
Idaho Power's 2016 assessment of Valmy concluded it
may not benefit customers from an economic and electric
reliability perspective to operate the facility beyond 2025. This
accelerated depreciation schedule is part of our commitment to
a glide-path away from coal, and ensures that the remaining
costs of Val my will be allocated to those customers who will
benefit from this resource.
The accelerated depreciation schedule for Valmy requires
advancing the recovery of the remaining plant investment
costs. Similar to paying off a home or car loan early, costs are
compressed into a shorter schedule. If Idaho Power uses a
schedule that ends in 2025, it would result in a $28.5 million
increase to accelerate recovery according to today's filing.
This amount includes accelerated depreciation of the plant,
decommissioning costs and capital investments forecasted
through the remaining life of the plant.
RECE IVED
2016 OCT 21 PM 3: 13
Depreciation Study
Every five years, Idaho Power files a depreciation study to
adjust its depreciation rates to match the longevity it is currently
experiencing for utility plant and equipment. Depreciation rates
establish the amount of time over which Idaho Power recovers
its investments in the electrical system through rates.
The difference in depreciation expense included in current
rates and depreciation expense reflected in today's filing is a
$6. 7 million increase.
How These Filings Will Change Prices
If the proposals are approved by the IPUC, the price Idaho
customers pay for electric service will increase by about
$35.2 million beginning June 1, 2017. The typical Idaho
residential customer using 1,000 kilowatt-hours (kWh) of
energy per month will see an increase of about $3.08 on
their monthly bill. This is an overall percentage increase of
3.10 percent from current prices. The actual percentage of
change will depend on a customer's group and the rate it pays.
REVENUE IMPACT BY CLASS:
Percentage Change from Current Billed Revenue
Small Large Large Overall Residential General General Irrigation
Service Service' Power1 Change
Valmy
2.42% 2.30% 2.58% 2.58% 2.64% 2.51% Depreciable
Life
Depreciation 0.57% 0.54% 0.60% 0.60% 0.62% 0.59% Study
Filings 2.99% 2.84% 3.18% 3.18% 3.26% 3.10% Combined
'Includes lighting Schedules 'Includes Special Contracts
Opportunities for Public Review
Idaho Power's filing is a proposal that is subject to public
review and approval by the IPUC. Copies of the application are
available to the public at the IPUC offices (472 W. Washington
St., Boise, Idaho, 83702), Idaho Power offices or on Idaho
Power's website, idahopower.com, or the IPUC website,
puc.idaho.gov. Customers also may subscribe to the IPUC's
RSS feed to receive periodic updates via email about the case.
Written comments regarding Idaho Power's application may
be filed with the IPUC. You can view additional materials on
the filing at idahopower.com/rates.
We value your business
and appreciate you
taking the time to read
this notice. Thank you. @ Printed on recycled paper.
©2016 Idaho Power