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Home My WebLink About20171013Application.pdf3Iffi*@:..;.: i-' II i i./ l: l"l lij r:i:r 13 Flt 3: ilr DONOVAN E. WALKER Lead Counsel dwalker@idahopower.com October 13,2017 VIA HAND DELIVERY Diane M. Hanian, Secretary ldaho Public Utilities Commission 472 West Washington Street Boise, ldaho 83702 Re: Case No. IPC-E-17-15 ldaho Power Company's Annual Compliance Filing to Update the Load and Gas Forecast Components of the lncremental Cost lntegrated Resource Plan Avoided Cost Methodology Dear Ms. Hanian Enclosed for filing in the above matter please find an original and seven (7) copies of ldaho Power Company's Annual Compliance Filing. Very yours, E. Walker DEW:csb Enclosures 1221 W. ldaho 5t. (83702) PO. Box 70 Boise, lD 83707 An IDACORP Companv DONOVAN E. WALKER (lSB No. 5921) ldaho Power Company 1221West ldaho Street (83702) P.O. Box 70 Boise, ldaho 83707 Telephone: (208) 388-5317 Facsimile: (208) 388-6936 dwa lker@ id a hopower. com IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING TO UPDATE THE LOAD AND GAS FORECASTS !N THE INCREMENTAL COST INTEGRATED RESOURCE PLAN AVOIDED COST MODEL. Attorney for ldaho Power Company BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION ) ) ) ) ) ) ) CASE NO. tPC-E-17-15 IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING ldaho Power Company ("ldaho Power") hereby respectfully submits to the Idaho 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 lncremental Cost lntegrated Resource Plan ("lClRP") avoided cost methodology. !. INTRODUCTION ln its final Order No. 32697, the Commission determined that the inputs to the ICIRP avoided cost methodology, utilized for all proposed Public Utility Regulatory Policies Act of 1978 ("PURPA") Qualifying Facility ("QF') projects that exceed the IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 1 I ,'\ published rate eligibility cap, will be updated every two years upon acknowledgement of the utility's Integrated Resource Plan ("lRP") filing, with the exception of the Ioad 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 fuel 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. ln 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 have been incorporated into ldaho Power's ICIRP 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 contractual avoided cost rates as of October 15,2017. II. LOAD FORECAST ldaho Power's most recent load forecast from October 2017 shows, on average, an increase in its customer loads when compared to the October 2016load forecast that IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 2 was provided to the Commission for the 2016 update in Case No. IPC-E-16-22 and approved by the Commission in Order No. 33646. Table 1 and Graph 1 below show the average annual load forecast for both the previously approved October 2016load forecast and the most recent 2017 load forecast through 2034. TABLE 1 Average Annua! Load Forecast Year 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 October 2016 (aMW) 1,810 1,840 1,864 1,874 1,894 1,914 1,935 1,955 1,975 1,990 2,007 2,018 2,039 2,053 2,067 2,074 2,095 2,112 October 2017 (aMW) 1,900 1,950 1,877 1,994 1,927 1,949 1,979 1,994 2,017 2,033 2,048 2,059 2,093 2,099 2,114 2,125 2,145 2,161 IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 3 GRAPH 1 Load Forecast 2,200 2,150 2,700 2,050 2,000 1,950 3[yl$/ 1,e00 1,850 1,800 L,750 L,700 "$ ,9t "S d,' ,"-d| ,S "S ".s,' .uS "&" "$ C p d," "-di "^S "S "&" III. NATURAL GAS PRICE FORECAST The natural gas price forecast that was updated in October 2016 was the U.S. Energy lnformation Administration's ("ElA") Reference Case forecast for Natural Gas Henry Hub Spot Price. Subsequent to that update, ldaho Power utilized EIA's Natural Gas Henry Hub Spot Price: High Oil and Gas Resource and Technology forecast, adjusted for pricing at Sumas and transport for ldaho City Gate delivery, in its IRP process. As of October 15,2017, ldaho Power will update the natural gas price forecast within the ICIRP avoided cost model to reflect the most recent EIA Natural Gas Henry Hub Spot Price: High Oil and Gas Resource and Technology forecast published on January 5,2017. Use of this forecast indicates a decrease in the average annual natural -Qst6!sp 2015 Load Forecast (aMW) -October 2017 Load Forecast (aMW) IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 4 gas forecast prices over the remaining period in comparison to the EIA 2016 natural gas price forecast that was used in the ICIRP avoided cost model from the previous update. Table 2 and Graph 2 display the 2016 EIA natura! gas price forecast and the current 2017 EIA natural gas price forecast. TABLE 2 EIA Natural Gas Henry Hub Spot Price forecast October 2016* October 2017** (nominalYear $/MMBtu) (nominal $/MMBtu) 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 3.21 3.83 4.34 4.90 4.89 5.03 5.59 6.00 6.27 6.22 6.31 6.50 6.69 6.84 6.93 7.11 7.19 7.32 2.83 3.22 4.24 4.81 4.39 4.21 4.39 4.56 4.74 4.65 4.73 5.05 5.14 5.09 5.05 4.84 4.83 5.32 IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 5 GRAPH 2 Natural Gas Price Forecast -2015 Henry Hub EIA* (nominal) -2017 Henry Hub EIA** (nominal) Notes: *2016 EIA Natural Gas Henry Hub Spot Price: Reference Case.**2017 EIA Natural Gas Henry Hub Spot Price: High Oil and Gas Resource and Technology, adjusted for ldaho City Gate delivery. !V. CONTRACT TERMINATIONS,IRATIONS. AND ADDITIONS ldaho Power currently has three non-PURPA, long-term power purchase agreements: Elkhorn Valley Wind (101 megawatts ("MW')), Raft River Geothermal (13 MW), and Neal Hot Springs Geothermal (22 MW). ldaho Power currently has 133 contracts with PURPA QF projects with a total nameplate capacity of 1,150 MW. lncluded in this update for signed Energy Sales Agreements ("ESA") are four new Oregon solar QF ESAs totaling 23.75 MW, one new ldaho biomass QF ESA for 5 MW, and three replacement ESAs for existing ldaho QF hydro projects totaling 2.75 MW. Please see Attachment 1 attached hereto for a list of new and terminated contracts since the last =Pco 1f>:(! .E Eoc @(J o-ri(!(9 6L)P(!z Se 57 Ss Ss S+ 5E 52 s1 So IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 6 "$ C "^o9 "-&t "-6P "-dP "S "$ .,-S "^&" "$ ,S ""tr "&" "d ',^E "S "^dy update on October 15,2016. New ESAs, terminated or expired contracts, as well as new complete ESA applications are all included in the ICIRP model on a continuous basis. V. CONCLUSION ldaho Power hereby respectfully submits this updated load forecast, natural gas forecast, and contract information in compliance with the Commission's directives in Order Nos. 32697 and 32802 and asks the Commission to accept the same for filing. Respectfully submitted this 13th day October 2017 . DONOVAN E. WALKER Attorney for Idaho Power Company IDAHO POWER COMPANY'S ANNUAL COMPLIANCE FILING - 7 BEFORE THE IDAHO PUBLIG UTILITIES COMMISSION GASE NO. IPC-E-17-15 IDAHO POWER COMPANY ATTACHMENT 1 Facility Type Project Name State Replacement Contract Date Hydro Hydro Hydro Shoshone CSPP Shingle Creek Rock Creek #1 ID ID ID Projects Not On-Line 70/3u2Ot6 s/8/2017 s/2s12077 0.36 o.22 2.17 TOTAT 2.75 Facility Type Project Name State Contract Date Project Size (MW) Solar Solar Solar Biomass Solar Brush Solar Morgan Solar Vale lSolar SISW LFGE Baker Solar Center OR OR OR ID OR LO/31/2OL6 70l3L12076 7013L/2076 3h312077 6lzLl2Ot7 2.75 3.00 3.00 s.00 15.00 TOTAL 28.75 Terminated/Expired Energy Sales Agreements Facility Type Project Name State Terminated/Expired Date Project Size (MW) Cogeneration Hydro Magic Valley MillCreek Hydro ID OR LLlzLl2016 6/30/2OL7 L0.00 0.80 TOTAL 10.80 Projects On-Line Project Size (MW)