20201002Amended Application.pdf

ft An IDACORP Company
October 2,2020
VIA ELECTRONIC FILING
Jan Noriyuki, Secretary
ldaho Public Utilities Commission
11331 W. Chinden Boulevard
Building 8, Suite 201-A
Boise, ldaho 83714
Re: Case No. IPC-E-19-19
2019 lntegrated Resource PIan
Dear Ms. Noriyuki:
Attached for electronic filing, pursuant to Order No. 34602, in the above matter is
ldaho Power Company's Second Amended 2019 lntegrated Resource Plan as set forth in
its procedural schedule letter dated July 31 ,2020. ldaho Power will hand deliver an
original and seven (7) printed copies of Idaho Power Company's Second Amended 2019
/RP and Appendices C and D, as well as redlined printed versions of those documents.
Please contact me at [phone] if you have any questions.
Very truly yours,
LISA D. NORDSTROM
Lead Counsel
! [e-mail]
LDN:slb
Attachments
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Lisa D. Nordstrom
LISA D. NORDSTROM (lSB No. 5733)
ldaho Power Company
1221West ldaho Street (83702)
P.O. Box 70
Boise, ldaho 83707
Telephone: [phone]
Facsimile: [phone]
I no rd strom @ ida hopowe r. co m
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Attorney for ldaho Power Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF IDAHO POWER
COMPANY'S 201 9 INTEGRATED
RESOURCE PLAN.
CASE NO. IPC-E-19-19
AMENDED APPL!CATION
COMES NOW, ldaho Power Company ("ldaho Power" or "Company"), which
respectfully submits the Company's Second Amended 2019 lntegrated Resource Plan
("Second Amended 2019 IRP'11 and requests that the ldaho Public Utilities Commission
("Commission") accept it for filing in accordance with Commission Order No. 22299. !n
support of this request, ldaho Power states as follows:
1 The complete Second Amended 2019 IRP consists of five separate documents: (1) the Second
Amended 2019 lntegrated Resource Plan; (2) Appendix A: Sales and Load Forecast; (3) Appendix B:
DSM Annual Report; (4) Appendix C: Technical Report; and (5) Appendix D: 82H Supplement. A copy
of the complete Second Amended 2019 IRP is provided as Attachment 1 and can also be found on the
Company's website at www.idahooower.com. As a courtesy to our readers, ldaho Power has provided a
redline version of the documents where changes were made - the Plan, Appendix C, and Appendix D -
in Attachment 2. The Company also submits its 2019 IRP Review Report documenting its review of the
entire IRP development process as Attachment 3. lnterested persons may request a printed copy of
these documents by contacting [e-mail].
AMENDED APPLICATION - 1
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I. INTRODUCTION
ldaho Power greatly appreciates the Commission and other parties' patience as
the Company conducted a thorough review and end-to-end re-run of its IRP in this
proceeding. ldaho Power believes that this careful, comprehensive review process will
ensure that future lRPs proceed more smoothly and continue to yield resource portfolios
that balance cost, risk, and the Company's commitment to clean energy.
This Second Amended 2019 /RP results in only one change to the Company's
near-term Action Plan-the exit year for the Valmy Unit 2 coal-fired power plant. ldaho
Power initially identified a Unit 2 exit by year-end 2025, but analysis as part of the
Second Amended 2019 /RP revealed the potential for additional savings from an exit as
early as year-end 2022. ln the coming months, the Company will conduct further
analysis to identify optimal unit exit timing that carefully weighs customer economics
and reliability concerns and ensures adequate capacity.
The Company's updated lRP continues to demonstrate a clear trajectory toward
ldaho Power's clean energy future, as reflected in the key resource decisions in the
Company's Preferred Portfolio: (1) 400 megawatts (MW) of new solar generation;
(2) development of the Boardman-to-Hemingway ("82H') transmission line; and
(3) complete exit from coal resources by 2030. The development of B2H, in particular,
provides a crucial carbon-free, supply-side resource that supports renewables and
enables the Company's transition away from coa!.
ldaho Power's Second Amended 2019 /RP provides a robust analysis of the
long-term planning and resource decisions needed to affordably and reliably serve
customers. ldaho Power therefore respectfully requests that the Commission accept
this Second Amended 2019 lRPfor filing.
AMENDED APPLICATION - 2
il. DlscusstoN
ldaho Power filed its original IRP on June 28,2019, and its Amended 2019 IRP
on January 31,2020.2 !n June of 2020, the Company identified necessary changes in
the Amended 2019 lRP, which prompted ldaho Power to initiate a comprehensive
review of its modeling and analysis. To allow time for the Company to complete this
review, on July 1, 2020, ldaho Power filed a Motion to Suspend the Procedural
Schedule. The Commission issued a Notice of Vacated Comment Deadlines on July
16, 2020, until the Company had concluded its review and submitted a revised
proposed schedule.3
A. ldaho Power Comprehensivelv Reviewed the lRP Cvcle.
During July of 2020, ldaho Power convened a team of subject matter experts
("lRP Review Team") to perform a comprehensive four-step review to deconstruct and
examine all aspects of the IRP analysis, from model inputs to model outputs. The IRP
Review Team included members of the Planning, Engineering & Construction, Power
Supply, and Finance departments, with additional support and consultation from
members of the lnternal Audit and Regulatory Affairs departments to ensure a
consistent and methodical review. The IRP Review Team conducted its analysis in four
steps:
. First, the IRP Review Team examined input data related to the IRP process.
This process involved 11 sub-teams to examine categories of AURORA
model data and cross-verifying this data against source materials. This step
2 On May 29,2020,|daho Power provided a correction to the IRP related to the costs associated with the
Jim Bridger Power Plant (Bridger). This correction required the replacement of seven pages in the
Company's Amended IRP but did not impact the Company's recommendation of the Preferred Portfolio,
which remained the least-cost, least-risk solution to serve customers.
3 Order No. 34723.
AMENDED APPLICATION - 3
also included reviewing regulatory decisions and orders that direct specific
AU RORA input treatment.
. Secon4 the IRP Review Team evaluated how data were modified or
converted as part of incorporating it into the AURORA model, to ensure that
any transformations or conversions were conducted properly.
. Third, the IRP Review Team examined the modeling logic that AURORA
used to analyze the data, to verify and validate that the model itself was
functioning in a logical manner and consistent with ldaho Power's knowledge
of its own system and resources.
o Fourth, the IRP Review Team analyzed results to ensure that the outputs
were consistent, logical, and accurate.
On July 31,2020, ldaho Power updated the Commission and parties that the
Company had concluded the detailed internal review and intended to perform a new
endto-end portfolio analysis. The Company committed to conduct this final lRP
analysis and present a finalized Preferred Portfolio and near-term action plan by
October 2,2020.
B. ldaho Power's Updated IRP Portfolio Modelinq Strenqthened the
Companv's Analvsis.
ldaho Power's Second Amended 2019 /RP applied an updated portfolio analysis
process compared to that used in the previous Amended 2019 lRP. The process of
conducting the Second Amended 2019 /RP was bolstered by the findings of the IRP
Review, which resulted in adjustments to model inputs and model operations. Further,
the updated portfolio selection and adjustment process in the Second Amended 2019
/RP included a number of methodological and modeling adjustments, including an
AMENDED APPLICATION .4
expanded affay of resource options (such as pumped hydro storage, geothermal, and
accelerated North Valmy Unit 2 exit), a wider range of Western Electricity Coordinating
Council ("WECc')-optimized resource mixes that were used as a starting point for
manual optimization, and a strengthened manual adjustment process. The Company's
portfolio modeling proceeded in the following steps:
. Idaho Power formed the lRP Review Team to provide clarity around the entire
IRP development process. The team's objectives were to verify the modeling
of key inputs, validate model outputs, ensure consistency and accuracy in
each step of the IRP modeling process, and identify appropriate and efficient
resolutions for any identified adjustments. The resulting 2019 IRP Review
Report, filed as Attachment 3 to this Amended Application, provides lessons
learned that were not only applied to ldaho Power's final 2019 IRP but can be
used in the development of future lRPs to ensure the process is more
efficient, transparent, and accurate.
o Following the input and modeling adjustments identified in the review
process, ldaho Power used AURORA's Long-Term Capacity Expansion
("LTCE") model to produce 24 different portfolios, based on a combination of
three natural gas price forecasts and four carbon cost forecasts. Each of
these forecast combinations were examined both with and without B2H.
These portfolios were optimized for the WECC region, not necessarily for
ldaho Power's service area.
o From the 24 WECC-optimized portfolios, ldaho Power identified six starting
points for manual adjustment with the objective of further reducing ldaho
AMENDED APPLICATION - 5
Power-specific portfolio costs while maintaining reliability. These six
portfolios reflect a broader selection of resource types, amounts, and timing
compared to the four portfolios selected for manual adjustment in the
Amended 2019 lRP.
o Each of the six portfolios were tested under four future natural gas and
carbon price conditions (Planning Gas-Planning Carbon, High Gas-Planning
Carbon, Planning Gas-High Carbon, and High Gas-High Carbon) for both
B2H and non-B2H alternatives.
. The manual adjustment process focused on identifying optimal exit scenarios
for the Jim Bridger coal units. Additionally, the Company performed
sensitivity analysis of a year-end 2022 exit from Valmy Unit 2, rather than a
year-end 2025 exit.
o Upon completion of the manual adjustments, the 24 final portfolios were
evaluated in each of the four natural gas and carbon price conditions using
the AURORA modelto determine their net present value.
o ldaho Power applied a stochastic risk analysis to understand each portfolio's
sensitivity to changes in natural gas prices, customer load, and hydroelectric
variability. This step remained similar to that performed in the previous
Amended lRP.
ln total, the Company's updated portfolio modeling analysis evaluated 48 portfolios,24
of which were developed by the LTCE model for optimization in the WECC-region, and
24 of which were developed through the manual refinement process.
AMENDED APPLICATION - 6
C. ldaho Power's Preferred Portfolio and Action Plan Enables ldaho
Power's Clean Energy Future.
The Company's new end-to-end IRP produced a Preferred Portfolio and Action
Plan that continues to support the Company's key action items as set forth in the
previous Amended lRP. Crucially, the Second Amended 2019 /RP continues to show a
clear path toward a clean energy future through the procurement of new solar
resources, a transition away from coal, and the development of B2H as a least-cost and
carbon-free supply-side resource.
Specifically, the Second Amended 2019 IRP analysis identified the Company's
Preferred Portfolio as the Planning Gas/Planning Carbon scenario with B2H; exit dates
for the Jim Bridger units in 2022,2026,2028, and 2030; and potential exit from Valmy
Unit 2 in 2022.4 The updated Action Plan continues to support the same three core
resource actions in the Preferred Portfolio of the Amended lRP, including (1)adding
120 MW of solar capacity by 2022; (2) exiting from four coal-fired generating units by
year-end 2022, and from a total of five of the Company's seven coal-fired units by year-
end 2026; and (3) the completion and operation of B2H in 2026.
Below is a summary of the Company's updated Action Plan.s The updated
Preferred Portfolio results in only one potential change to ldaho Power's near-term
2020-2026 Action Plan-the exit timing of Valmy Unit 2. The Valmy Unit 2 exit is
currently reflected as year-end 2022, but the exit window is subject to ongoing analysis
to identify an optimal date between year-end 2022 and year-end 2025.
a The specific exit date for Valmy Unit 2 remains subject to further analysis of economic and reliability
concerns.
s The Jackpot Solar Power Purchase Agreement and the Company's exit from Valmy Unit 1 are not listed
in the Action Plan, as these items were completed in 2019.
AMENDED APPLICATION - 7
Year Action
2020-2022
2020-2022
2020-2021
2020-2026
2020
2020
2020
2020
2020-2021
2021-2022
2022
2022
2022
2026
Plan and coordinate with PacifiCorp and regulators for early exits from Jim Bridger units. Target dates
for early exits are one unit during 2022 and a second unit during 2026. Timing of exit from second unit
coincides with the need for a resource addition.
lncorporate solar hosting capacity into the customer-owned generation forecasts for the 2021 lRP.
Conduct ongoing B2H permitting activities. Negotiate and execute B2H partner construction
agreement(s).
Conduct preliminary construction activities, acquire long-lead materials, and construct the 82H project.
Monitor VER variability and system reliability needs, and study projected effects of additions of 120 MW
of PV solar (Jackpot Solar) and early exit of Bridger units.
Exit Boardman December 31 ,2O2O.
Bridger Unit 1 and Unit 2 Regional Haze Reassessment finalized.
Conduct a VER lntegration Study.
Conduct focused economic and system reliability analysis on timing of exit from Valmy Unit 2.
Continue to evaluate and coordinate with PacifiCorp for timing of exiUclosure of remaining Jim Bridger
units.
Subject to coordination with PacifiCorp, exit Jim Bridger unit (as yet undesignated) by December 31,
2022.
Jackpot Solar 120 MW on-line December 2022.
Exit Valmy Unit 2 by December 3'1,2022.6
Subject to coordination with PacifiCorp, exit Jim Bridger unit (as yet undesignated) by December 31,
2026. Timing of the exit from the second Jim Bridger unit is tied to the need for a resource addition
(B2H).
Over the modeling time horizon, the Preferred Portfolio in the Second Amended
2019 /RP includes a number of additional changes from the previous analysis, including
reductions in new wind and solar in the latter years of the analysis (reflecting the
diminishing contribution of these resources to ldaho Power's peak load), as well as a
15 MW increase in demand response, bringing the total amount in the Preferred
Portfolio to 45 MW. ldaho Power believes that these updates to the Company's IRP
provide a clear and reliable path fonrvard in pursuit of a clean energy future, while
ensuring the least-cost, least-risk set of resources to meet customer needs and ensure
reliability.
6 As noted earlier, the specific exit date for Valmy Unit 2 remains subject to further analysis of economic
and reliability concerns.
AMENDED APPLICATION - 8
III. PROPOSED SCHEDULE
The Commission previously vacated the procedural schedule in this matter at
ldaho Power's request until the Company had concluded its review and submitted a
revised proposed schedule.T Having met the October 2nd date the Company proposed
to make this filing, ldaho Power now proposes to work with Staff and intervening parties
to develop a procedural schedule for review of the Second Amended 2019 lRP. ldaho
Power also commits to supplementing past responses to data requests to align with the
changes to the lRP, which will assist the parties in their review.
The Company believes that an expeditious review and conclusion of the 2019
IRP by February 2021 will position us well to engage with stakeholders on the 2021
IRP, with the goal of filing that IRP in the latter part of 2021.8 ldaho Power appreciates
the support and flexibility of other parties and the Commission as the Company has
endeavored to strengthen its resource modeling and planning processes in this
proceeding.
tv. coNcLUSroN
ldaho Power recognizes that the Company's 2019 IRP has proceeded on an
extended timeframe, including both this comprehensive update as well as previous
updates and amendments. The Company appreciates the opportunity to ensure that its
planning practices are complete and correct and believes that the process will help
ensure that future lRP proceedings are more efficient, transparent, and replicable. And
7 Order No. 34723 (July 16, 2020).8 ln Order No. 30281 issued on March 26,2007, the Commission found that receiving each electric
utility's lntegrated Resource Plan (lRP) within a narrower time frame would improve the overall planning
process and assist in regional planning efforts. The Commission accepted ldaho Poweds plan to file its
next IRP on or before the last business day of June 2009 in Order No. 30317 (May 23, 2007). Although
ldaho Power has endeavored to adhere to the June 30 timeframe in subsequent lRPs, the Company will
likely file a Petition after the conclusion of this case requesting to delay filing of the 2021 lRP.
AMENDED APPLICATION - 9
most importantly, the Company believes that the improved processes will support the
Commission and stakeholders' confidence in this Second Amended 2019 lRP. For
these reasons, ldaho Power respectfully requests that the Commission issue its order
accepting the Company's Second Amended 2019 /RP and finding that the Second
Amended 2019 /RP meets the requirements of Commission Order No. 22299.
DATED at Boise, ldaho, this 2'd day of October 2020.
X*!(,^1.+r"-*,
LISA D. NORDSTROM
Attorney for ldaho Power Company
AMENDED APPLICATION - 1O
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 2nd day of October 2020,1 served a true and
correct copy of IDAHO POWER COMPANY'S AMENDED APPLICATION upon the
following named parties by the method indicated below, and addressed to the following:
Commission Staff
Edward Jewell
Deputy Attorney General
!daho Public Utilities Commission
1 1331 W. Chinden Boulevard
Building 8, Suite 201-A
Boise, ldaho 83714
ldaHydro
C. Tom Arkoosh
ARKOOSH LAW OFFICES
802 West Bannock Street, Suite LP 103
P.O. Box 2900
Boise, ldaho 83701
ldaho Conseryation League
Benjamin J. Otto
ldaho Conservation League
710 North 6th Street
Boise, ldaho 83702
STOP B2H Coalition
Jack Van Valkenburgh
Van Valkenburg Law, PLLC
P.O. Box 531
Boise, ldaho 83701
Jim Kreider
60366 Marvin Road
La Grande, Oregon 97850
ldaho Sierra Club
Julian Aris, Associate Attorney
2101 Webster Street, Suite 1300
Oakland, California 94612
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stacie.foor@arkoosh. com
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AMENDED APPLICATION - 11
Gloria D. Smith, Managing Attorney
2101 Webster Street, Suite 1300
Oakland, California 94612
Ana Boyd, Research Analyst
2101 Webster Street, Suite 1300
Oakland, California 94612
lndustrial Customers of ldaho Power
Peter J. Richardson
RICHARDSON ADAMS, PLLC
515 North 27th Street (83702)
P.O. Box 7218
Boise, ldaho 83707
Dr. Don Reading
6070 Hill Road
Boise, ldaho 83703
Micron Technology, Inc.
Austin Rueschhoff
Thorvald A. Nelson
Holland & Hart, LLP
555 Seventeenth Street, Suite 3200
Denver, Colorado 80202
Jim Swier
Micron Technology, lnc.
8000 South FederalWay
Boise, Idaho 83707
AMENDED APPLICATION - 12
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tnelson@hollandhart. com
aclee@ hol land hart. com
q lqarganoamari@ holland hart. com
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Stephanie L. Buckner
Executive Assistant
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPG.E.I9.19
IDAHO POWER COMPANY
ATTAGHMENT 1
SECOND AMENDED
2019 INTEGRATED RESOURCE PLAN
BEFORE THE
IDAHO PUBLIC UTILITIES GOMMISSION
GASE NO. IPG-E-I9-19
IDAHO POWER COMPANY
ATTACHMENT 2
SECOND AMENDED
2019 INTEGRATED RESOURCE PLAN
(REDLINED VERSIONS OF THE PLAN,
APPENDTX C AND APPENDTX D)
BEFORE THE
IDAHO PUBLIG UTILITIES COMMISSION
GASE NO. IPC-E-I9-19
IDAHO POWER GOMPANY
ATTACHMENT 3
2019 IRP REVIEW REPORT